Importer Security Filing and Additional Carrier Requirements

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1 Importer Security Filing and Additional Carrier Requirements 10+2 Trade Outreach Webinar Spring

2 Today s Presentation on 10+2 Overview of the ISF Requirements Program Update Enforcement Strategy Top ISF Issues Q & A Session Los Angeles - Long Beach Seaport 2

3 What is the Security Filing? The Security Filing, commonly known as the 10+2 initiative, is a Customs and Border Protection (CBP) regulation that requires importers and vessel operating carriers to provide additional advance trade data to for non-bulk cargo shipments arriving into the United States by vessel. Importer Requirements: U.S. Bound Cargo: requires the electronic filing of an Importer Security Filing (ISF) comprised of 10 data elements (a.k.a., ISF-10 ). Transit Cargo: requires the electronic filing of an ISF comprised of 5 data elements (a.k.a., ISF-5 ). Carrier Requirements: Vessel Stow Plans required for arriving vessels with containers. Container Status Messages required for containers arriving via vessel. 3

4 Importer Security Filing (ISF) Importer The party required to submit the Importer Security Filing (ISF) is the party causing the goods to enter the limits of a port in the United States. This party is known as the ISF Importer. Could be the owner, purchaser, consignee, or agent (e.g. customs broker). The ISF Importer, as a business decision, may designate an authorized agent to file the Importer Security Filing on the ISF Importer s behalf. If an agent is used for ISF purposes, a power of attorney (POA) is required. The ISF Importer is ultimately responsible for the timely, accurate and complete submission of the ISF filing.

5 ISF-10 Data Elements U.S.-bound Cargo (3461 Entries, IT, FTZ) 1. Importer of Record Number 2. Consignee Number 3. Seller (Owner) name/address 4. Buyer (Owner) name/address 5. Ship to Party 6. Manufacturer (Supplier) name/address 7. Country of Origin 8. Commodity HTS-6 9. Container Stuffing Location 10. Consolidator (Stuffer) name/address 11. Bill of Lading Number (house or reg.) 12. ISF Importer CBP Form

6 From Order to Delivery Overseas Factory/Warehouse Shipper/Carrier Distribution Center Consolidator (Stuffer) Container Stuffing Location Ship To Party Container Stuffing Location Manufacturer (Supplier) Consolidator (Stuffer) ISF Importer Seller (Owner) The ISF-10 is due 24 hours prior to vessel lading Vendor/Supplier Manufacturer (Supplier) Seller (Owner) ISF Importer Ship To Party Invoice Purchase Order Importer/Retailer ISF Importer Importer of Record # Consignee # Buyer (Owner) Ship To Party 6

7 ISF Filing Requirements All ISF filings are to be done electronically via the vessel Automated Manifest System (AMS) or the Automated Broker Interface (ABI) ISFs cannot be done at the Port of Entry (i.e., Custom House) on a walk-in basis There is no paper form (e.g., 3461) Bonds are required to cover most ISF transactions 7

8 ISF Filing Options CBP has begun development of an internet-based web portal to accept ISF filings Importers must pre-register their importer ID numbers with CBP (i.e., IRS# or SSN#) Registration of the importer ID number can be done in person at a local Port of Entry or by a licensed customs broker via the use of CBP Form 5106 Portal will be available no earlier than August 2010 Use of the portal will probably be limited to no more than two (2) ISF filings per day, with a maximum of twelve (12) per year In addition, some service providers allow self-filers indirect access to CBP systems via the internet Contact a CBP Client Representative at to discuss self-filing options

9 10+2 Interim Final Rule Effective Date: The interim final rule (IFR) took effect on January 26, 2009 (60 days after the publication date) and allowed for certain flexibilities : Timing of transmission for 2 of the 10 ISF data elements Range of responses for 4 of the 10 ISF data elements All other requirements in this rule were adopted as a final rule. Compliance (Enforcement) Date: January 26, 2010 The IFR flexibilities will stay in effect until the structured review is completed and a decision on keeping, modifying or removing them is made by DHS, OMB and other executive branch agencies. 9

10 Structured Review and Flexible Filing CBP monitors all ISF submissions for timeliness, accuracy and completeness. On the basis of information obtained during the structured review and public comments, DHS will undertake an analysis of the elements subject to flexibilities. Analyze Flexible Range of Responses (FR) Elements Ship to Party Manufacturer (Supplier) name/address Country of Origin Commodity HTS-6 Only 2% of all filings claim to use the flexible filing option Analyze Flexible Timing (FT) Elements Container Stuffing Location Consolidator (Stuffer) name/address If you choose to use a flexible option, you MUST amend your filing with a CT 10

11 ISF Data Improves Targeting Capabilities 40 Container Source Description HTS C/O Role Party BILL OF LADING SHEET N/A N/A Shipper XYZ LOGISTICS Non Intrusive Inspection (NII) X-Ray Consignee ABC TRUCKING Image Only NEW SECURITY FILING DATA NII Image and Manifest Data BED LINEN CN MFR/Supl. XINJIANG TOP BEDDING PRODUCTS Seller XINJIANG TOP BEDDING PRODUCTS Stuffing Location XINJIANG, What s CN in the Buyer box? BE & D IMPORT INC (PHX., AZ) Consolidator XYZ LOGISTICS Importer BE & D IMPORT INC (PHX., AZ) Ship To Name/Add. THE TRANSFER WHSE (L.B., CA) Consignee BE & D IMPORT INC (PHX., AZ) 11

12 ISF Data Improves Cargo Identification Bullet Casings HTS Bomb Casings Gear Casings What Are Casings? Motor Casings Computer Casings Sausage Casings Tire Casings Pipe Casings HTS HTS

13 10+2 Program Update 13

14 ISF-10s By the Numbers January 26, 2010 May 2, 2010 Total Submissions: Total Rejected: 2,453,200 80,293 3% Total Accepted: 2,372,907 97% Adds: Replaces: Deletes: 79% 19% <1% Note: Do NOT send in a REPLACE to simply force an ISF- Bill match message! Filers: 2,226 Importers (IOR #s): 123,

15 Top Five Error Messages ISF-10 Errors from January 26, 2010 April 25, ,000 52,259 50,000 40,000 30,000 19,791 17,502 20,000 13,231 9,010 10,000 0 Duplicate ISF Invalid ISF Transaction # Invalid Country Code Invalid HTS # Invalid ID Code 15

16 ISF Progress Reports In production since May 10, 2009 Registration is Required Reports are on a Monthly Cycle Reports Cover 122,251 ISF Importers We Offer.pdf,.csv, and.xls Formats Four Types Currently in Production: Importer by Filer Reports (most common) - Over 1,105 ISF Filers are registered Filer Summary Report C-TPAT Importer Reports (Tier 3, 2) C-TPAT Importer Transactional Reports (Tier 3) 16

17 Importer Security Filing (ISF) Progress Reports 1. ISF10 Submission Volume:

18 C-TPAT Benefits of 10+2 Earlier Decision Making C-TPAT entities are reliably identified prior to vessel lading Based on Importer of Record Number on the ISF No longer tied solely to entry data (24 hours or more prior to arrival) Better Decision Making Customs - Trade Partnership Against Terrorism Tangible C-TPAT benefits are applied much further upstream Receive targeting credit based upon their tier status Stabilization of Automated Hold Process Immediate Transportation (IT) in-bond risk assessments are more stable Validation of Supply Chain Security Reviews New Entities and Locations Identified and/or Verified Container Stuffing Location Consolidator (Stuffer) name/address

19 10+2 Enforcement Strategy CBP s Vessel Stow Plan Module Used to identify unmanifested containers 19

20 ISF Enforcement Strategy The full compliance (enforcement) date for the 10+2 requirements commenced on January 26, 2010, thus ending a 12-month delayed enforcement period in which CBP provided extensive outreach to educate the trade community on the new requirements. CBP will: Apply a measured, commonsense approach to enforcement Exercise the least amount of force necessary to obtain full compliance Evaluate non-compliance on a case-by-case basis Continue to provide outreach and guidance to the trade X 20

21 Informed Compliance Efforts Enforcement Measures Public outreach (incl. webinars, meetings, ISF Progress Reports) Informal and formal notification (e.g., warning letters) Mid-level Compliance Measures Domestic NII examination manifest holds Domestic physical examinations Re-evaluation and possible reduction of C-TPAT status Strictest Enforcement Measures ISF Jail (i.e., lengthier manifest holds) Liquidated Damages Suspension or Revocation of C-TPAT Status Do Not Load or Do Not Discharge Orders 21

22 10+2 Challenges 22

23 Top ISF Issues Identified How does CBP measure ISF Timeliness? The regulation states 24 hours prior to lading (Legal) CBP will measure by the Vessel Departure Date minus 24 hours (Practical) Which bill of lading number do I use? Must use the lowest bill of lading transmitted in AMS (house or regular) Contact your shipper New ABI query functionality will help CBP allows for the bill of lading number to be updated on the ISF I can t get a bond because I missed the filing deadline CBP is considering creating a Type 13 Late ISF coded transaction Importers are acknowledging that they violated the regulations Will probably not be available for longer than one (1) year 23

24 Top ISF Issues Identified I didn t receive the ISF Bill on File match message. This is common; especially when the ISF filing precedes the filing of the customs manifest (i.e., bill info). Make sure you (or your agent) annotated the correct bill type on the ISF. Regular Bill This bill type is also referred to as an Ocean" or Simple Bill and is issued by a Carrier. There are no underlying house bills. House Bill Typically issued by a NVOCC (sometimes referred to as an automated freight forwarder). A house bill of lading always falls under a carrier s Master bill of lading. ISFs cannot be filed against Master Bills Do NOT Send in a REPLACE to force an ISF-Bill Match message Do I need to file 24 Hours prior to lading of the feeder or mother vessel? The ISF is due 24 hours prior to lading of the mother vessel 24

25 Go to: Available Resources Copy of the Interim Final Rule ISF PowerPoint Presentation General Frequently Asked Questions (FAQs) Document Copy of the Regulatory Assessment Implementation Guides (Technical File Formats) Mitigation Guidelines News Releases Outreach Schedule 25

26 Questions? Contacts Richard Di Nucci, Director, Cargo Control Division John Jurgutis, Branch Chief, ISF & Vessel Manifest Stephen Silvestri, Branch Chief, Air & Rail Manifest Craig Clark, Program Manager, ISF Joseph Martella, Program Manager, New York Field Office 26

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