Trade News Quarterly June 2016

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ACE Update – Parker & Company is now filing all customers’ entries in ACE (7501 data). We are currently filing all OGAs in ACE Beginning July 23, 2016 trade parties will be required to submit electronic entries and entry summaries for additional entry types to the Automated Commercial Environment (ACE). Electronic entries and entry summaries associated with the following entry types will be accepted and mandated in ACE: 02, 07, 12, 21, 22, 31, 32, 34, and 38. Filing of electronic entries and entry summaries associated with entry types 06 and 23 were previously mandated in ACE if they did not include quota merchandise. Filing of these transactions with quota merchandise will also be mandated on July 23, 2016.

FDA Giving Priority Processing to ACE Entries – Average processing time for manual review and release of ACE-submitted entries is 25 percent faster than for ACS-submitted entries and release times for document reviews are 33 percent faster (a time savings of 1.5 days).

ACE Application, CF 28 Under Review ACE Application. U.S. Customs and Border Protection is accepting comments through Aug. 15 on a proposal to revise its application to use the Automated Commercial Environment to reflect the addition of a new application for brokers, importers, sureties, attorneys and other parties to establish an ACE portal account to file protests. There are no proposed changes to the existing ACE portal application for imported goods. Trade members wishing to establish a protest filer account in ACE will need to submit the following data elements.
– organization information (protest filer number (EIN, SSN or CBP-assigned number), organization name and type, end of fiscal year, mailing address)
– ACE account owner information (name, date of birth, email address, telephone number, fax number (optional), account owner address (if different from company address)) – filing notification point of contact (name and email address)

CF 28. CBP is accepting comments through July 14 on the proposed extension without change of CBP Form 28, Request for Information. CBP is responsible for appraising imported merchandise by ascertaining its value, classifying goods under the tariff schedule and assessing a rate and amount of duty to be paid. When the invoice or other documentation does not provide sufficient information for appraisement or classification, CBP requests additional information by sending this form to importers or their agents.

Imaging update – Parker & Company is installation imaging systems of various venders with a plan to implement imaging towards year end. Included with the system will be the ability of customers to log in via the internet to view and print their own files.

Broker-Known Importer Program Offers another Option to Expedite Shipments
U.S. Customs and Border Protection has announced the implementation of the Broker-Known Importer Program, which offers an additional avenue to enhance the sharing of trade intelligence between importers and brokers and between the trade community and CBP. With a limited number of importers expected to avail themselves of the Importer Self-Assessment and Trusted Trader programs, BKIP offers a way for CBP to use the importer-broker relationship to further identify reputable importers and thus narrow the field of actors on which it focuses its enforcement resources. However, it is unclear at this point exactly how CBP plans to use the BKIP and whether many brokers will participate.

Under this voluntary program, licensed customs brokers work with their importer clients to review in greater depth their import programs in the context of import regulations. A review should cover issues such as antidumping and countervailing duties, intellectual property rights, classification and valuation, free trade agreements and preference programs, country of origin, marking and supply chain security as well as documentation and information requirements for customs clearance, recordkeeping and drawback. Brokers may not rely on reviews conducted by other brokers and must redo their reviews periodically. Reviews are thus expected to result in increased compliance understanding on the part of importers as well as improved entry accuracy.

The broker uses an electronic indicator on the entry (functionality that has already been deployed in the Automated Commercial Environment) to signal to CBP that the importer is known to the broker and that the review has taken place. This indicator will factor into CBP’s cargo risk segmentation, which may improve the importer’s risk profile in CBP’s targeting system and thus help expedite shipments at the time of arrival. Additional benefits under this program may also be extended to importers in the future.

CTPAT news and bulletins –

Parker & Company Completed a CTPAT revalidation in May
Parker & Company encourages all customers, transport companies and warehouses our customers and transport partners to use the seven-point inspection process for empty containers prior to the loading the cargo, as well as the seventeen-point inspection process for all trailers/tractors, and that this should be followed. Here is a link to the page that has both procedures to be down loaded. The procedures are found in the CTPAT resources library at:

Trailer and container security; All customers and transport companies are reminded: all loaded U.S.-bound containers and trailers must have a ISO 17712 high-security seal affixed.

Compromised seals: Parker and Company encourages all customers and business partners to report to CBP or appropriate foreign authority compromised seals.

Overages and shortages the importer/exporter is obligated to notify CBP and/or any other appropriate law enforcement agency of any errors and/or shortages and overages of merchandise that create a security risk in the supply chain.

Feds Seeking New Ideas to Achieve 100 Percent Cargo Container Scanning
The Department of Homeland Security recently extended for a third time the deadline for complying with a congressionally mandated requirement of 100 percent scanning of U.S.-bound maritime cargo containers. However, DHS is also soliciting new ideas on how to meet this requirement, an effort that has some business groups concerned.

Trade news Quarterly June 2016All-water service replaces Mexican intermodal route to Houston –
With the opening of the Panama canal, a new Panama Canal container route to the U.S. Gulf from Asia will replace and build on an intermodal rail service that Maersk Line launched via Mexico.

Parker & Company offers Mexican West and East Coast container freight services –
Parker and Company Monterrey office handles all our Mexican clients Container freight services we offer Competitive Ocean rates via Manzanillo, Lazaro Cardenas, and also East Coast Port of Altamira. We provide trucking services from Monterrey KCS rail ramp and Altamira port. We also have Mexican broker clearance services. Our service is provided through our large international network of WNA agents providing hands on service. Please contact Ben Rodriguez in Monterrey office

Solas Update – So much news and noise on SOLAS approaching the July 1 implementation date. Here is an update, feel free to share with membership of each local association:

  1. Both the G6 Alliance carriers and the larger OCEMA group of carriers have issued statements that carriers will accept terminal weights in lieu of VGM submission by the shipper/forwarder. Further, the G6 has announced that their carriers will accept the shipper-provided cargo weight required by law for cargo tendered to the railroad, then marry that with the tare weight of the container in order to calculate VGM; this will take care of the on-dock arrivals. These are consistent with the US Coast Guard’s Equivalency declaration issued in April.
  2. Individual carriers are starting to announce their policies, which mirror the above. The bottom line is that the shipper/forwarder do NOT have to calculate the VGM, the carriers will accept the container weights provided by the terminals. HMM was first out of the box with a written statement, which is consistent with what others are conveying verbally. I suspect all carriers will have their notices out this coming week.
  3. While some terminals (Charleston, Savannah, Houston and Oakland OICT and TraPac for examples) are issuing statements, in writing, that they will accept containers without VGM and will give the weights to the carriers, many others are not there yet, even as July 1 approaches. There are people in the government and out, working on bringing those terminals on board.
  4. FMC and USCG very concerned about potential disruption. FMC Chairman Cordero issued a forceful statement that carriers should accept terminal weights; carriers appear to be acting accordingly. Now the question is if he will issue a similar statement to encourage all container terminals to work towards the solutions provided by the “early movers” – Charleston, etc.
  5. Some NVO’s, vendors and forwarders continue to send messages to shippers offering to calculate and transmit the VGM to the carriers, at a fee. It appears that the developments in items 1, 2 and 3 above, will make that service unnecessary for cargo loaded at US terminals. However, this is likely going to be a service of interest to shippers exporting from foreign countries.
  6. The USCG will remind all parties that the IMO issued a notice of a “transition” period for 90 days following July 1, during which countries have discretion as to enforcement of the SOLAS rule.
  7. It is unclear what other countries will do. Thus far, Canada, England, Japan have issued strict compliance requirements, Requiring the SOLAS Method 1 or 2 guidelines, both requiring the shipper to calculate and submit the VGM (the loaded container weight) to the carrier, which will submit to the terminal. China has issued somewhat similar statements, but the expectation of enforcement is less. Other countries, have simply said they are not ready. However, it will be up to the carriers, in all countries, to decide if and how they want to enforce the SOLAS guidelines. Of particular interest is whether Canada decides to retain a strict enforcement regime, or if it will follow the US example, per the USCG Equivalency. Courtesy Peter Friedman

Parker & Company Trucking- Parker & Company has trucks in Houston every day; we can pick up your freight at the airport cargo terminal or from many of the import warehouses in the Greater Houston area. Contact our Freight department for rates either Xavier Cardenas or David Dubois

Toxic Substances Control Act Reform Signed Into Law – The Environmental Protection Agency said the new law includes a number of improvements to TSCA, including a mandatory requirement for the EPA to systematically prioritize and evaluate existing chemicals on a specific and enforceable schedule, a requirement for the EPA to evaluate the safety of chemicals based purely on the health risks they pose, increased public transparency for chemical information, and the authority for the EPA to collect up to $25 million a year in user fees from chemical manufacturers and processors to pay for the improvements.

Importer Security Filing Enforcement to Tighten June 30 – Tighter enforcement of the importer security filing requirement beginning June 30 could result in an increase in penalties or cargo holds at some ports and may also present a challenge to small and new importers. Under the ISF rule, importers and maritime cargo carriers must submit additional cargo data prior to lading goods on board vessels destined to the U.S. customs territory. Importers have to report 10 data elements on each ISF or five for shipments consisting entirely of freight remaining on board cargo or goods intended to be transported in-bond as an immediate entry or transportation and exportation entry. CBP’s goal is to have all data elements filed 24 hours prior to lading, but it allows for some flexibility either in timing or interpretation for six of the data elements.

Importers are legally responsible for the accuracy and timeliness of their ISF filings, regardless of whether a customs broker or other intermediary does the actual filing. Typically, the ISF importer is the goods’ owner, purchaser, consignee or agent, such as a broker. For foreign cargo remaining on board, the ISF importer is the carrier. For immediate exportation and transportation and exportation in-bond shipments, and goods to be delivered to a foreign-trade zone, the ISF importer is the party filing the IE, T&E or FTZ documentation.

In 2014 CBP adopted a revised enforcement strategy for the ISF-10 requirement that provided for discretion at the port level based on infrastructure and staffing resources (i.e., cargo holds vs. liquidated damage claims). Under this strategy CBP has given at least three warnings to violating importers before pursuing LD claims against their bonds (the so-called three strikes approach). Ports were advised to focus enforcement actions on the most severe violations; i.e., significantly late or missing ISFs, which are subject to penalties of $5,000 to $10,000 each. Under this strategy ISF filings after arrival are always late and exposed to both LD claims and ISF holds. CBP now states that for shipments that are on the water on or after June 30 (a) ports will no longer be required to send requests for LD claims to CBP headquarters for review and (b) the three strikes approach to LD claims will end. CBP notes that there is no change to cargo holds for ISF non-compliance and that ports may hold cargo instead of (or in addition to) initiating LD claims.

CBP Moves Ahead with Border Infrastructure Projects, Announces Year-Round Solicitations- U.S. Customs and Border Protection announced June 21 that three new proposals have been selected to engage in further planning and development activities as part of the Donations Acceptance Program. Under this program CBP and the General Services Administration may accept donations of real property, personal property (including monetary donations) and non-personal services from private sector and government entities for port of entry construction, alterations, operations and maintenance activities.
– the city of Donna, Texas, has proposed constructing new inspection facilities and implementing more technologies to facilitate inbound empty commercial vehicle inspections at the Donna-Rio Bravo port of entry
– the city of Pharr, Texas, proposed multiple improvements including constructing a new cold inspection facility and a new agricultural inspection training and development facility and expanding secondary inspection dock space at the Pharr POE
– Red Hook Terminals proposed donating a perforating machine in support of operations at the Port of Freeport, Texas CBP and GSA will now work with these partners to establish a memorandum of understanding outlining forthcoming planning and development activities, obligations, and roles and responsibilities.

Food Facilities Must Act to Prevent Intentional Adulteration Under FDA Rule – The Food and Drug Administration has finalized a new food safety rule that will require food businesses in the United States and abroad to take steps to prevent intentional adulteration of the food supply. This rule, which incorporates several major revisions from the FDA’s proposal to provide for greater flexibility and clarity, marks the last of the seven major rules implementing the core of the Food Safety Modernization Act to be completed. For the first time, domestic and foreign food facilities that manufacture, process, pack or hold food and are required to register as food facilities (with some exceptions) will be required to prepare and implement a written food defense plan that assesses significant vulnerabilities to deliberate contamination where the intent is to cause wide-scale harm to public health. These facilities will also have to identify and implement strategies to minimize or prevent these vulnerabilities and establish and implement food defense monitoring procedures, corrective actions and verification activities. This rule is effective as of July 26 but compliance will not be required until July 26, 2019, for facilities other than small businesses and July 26, 2020, for small businesses.

Foot notes – Articles in this newsletter are taken from variety of sources. Including Journal of Commerce, Sandler and Travis newsletter, and NCBFAA Monday morning briefing. Other articles are personally written by the newsletter publisher Frank Parker.

The publisher has taken all reasonable steps to verify the accuracy of the content of this site. However, Parker & Company shall not be responsible for errors or omissions. Any advice in this newsletter is general and we recommend you contact Parker & Company licensed brokers or your customs council with specifics on your import or export transactions.