November 25, 2008

U.S. Customs and Border Protection has just published in today’s Federal Register the new “interim” regulations, which require importers (or their agents) to transmit an “importer security filing” no later than 24 hours before cargo is laden aboard the vessel at a foreign port. This information must be submitted to CBP by way of a CBP-approved electronic data interchange system.

The Importer Security Filing consists of 10 elements, unless an element is specifically exempted. The 10 elements are:

1. Seller;
2. Buyer;
3. Importer of record number / Foreign trade zone applicant identification number;
4. Consignee number(s);
5. Manufacturer (or supplier);
6. Ship to party;
7. Country of origin;
8. Commodity HTSUS number;
9. Container stuffing location; and
10. Consolidator (stuffer).

The manufacturer (or supplier), country of origin, and commodity Harmonized Tariff Schedule of the United States (HTSUS) number must be linked to one another at the line item level.

These regulations are said to specifically fulfill the requirements of section 203 of the Security and Accountability for Every (SAFE) Port Act of 2006 and section 343(a) of the Trade Act of 2002, as amended by the Maritime Transportation Security Act of 2002.

Effective Date: This rule is effectives 60 days from the date of publication in the Federal Register, which is expected on November 25, 2008.

Compliance Dates: ISF Importers and carriers must comply with the “10+2” filing requirements one year from the effective date or, on and after January 26, 2010 (see sections 4.7c(d), 4.7d(f), and 149.2(g)).

CBP has said that it will show restraint in enforcing the rule, taking into account difficulties that importers may face in complying with the rule, progress toward compliance, and are making a good faith effort to comply with the rule to the extent of their current ability. This enforcement policy will last for a period of twelve months after the effective date.

Summary of Changes from NPRM

As referenced below, CBP is making several changes from the proposed rule. Some of these changes include:

1. CBP has added flexibility for four Importer Security Filing elements (Manufacturer (or supplier), Ship to party, Country of origin, and Commodity HTSUS number). Specifically, CBP is allowing importers, in their initial filing, to provide a range of acceptable responses based on facts available to the importer at the time, in lieu of a single specific response (which may become known to the importer only at a later time).
   
   Additionally, while date elements for Container stuffing location and Consolidator (stuffer) must be submitted as early as possible, CBP is extending the time period for submitting this data to no later than 24 hours prior to arrival in a U.S. port (or upon lading at the foreign port if that is later than 24 hours prior to arrival in a U.S. port).
   
   Importers will be required to update their filings with respect to these elements as soon as more precise or more accurate information is available, in no event less than 24 hours prior to arrival at a U.S. port (or upon lading at the foreign port if that is later than 24 hours prior to arrival in a U.S. port).
   
   
2. The liquidated damages amount for violations of the Importer Security Filing requirements are changed from the value of the merchandise, as proposed, to $5,000 for each violation in proposed §§ 113.62(j), 113.64(e), and 113.73(c) and new § 113.63(g) and Appendix D to part 113.

An explanation of other important changes can be found in Section III, E., of the interim final rule.

Additional comments on CBP’s interim final rule will be coming in future publications.

Further information about the 10+2 rules can be found in our previously published newsletters: “Get Ready For “10+2” Importer Security Filings”, “10 + 2 What Does It Mean For You”. If you have any questions or comments, please contact George Tuttle, III at (415) 986-8780 or via email at geo@tuttlelaw.com.

George R. Tuttle, III is an attorney with the Law Offices of George R. Tuttle in San Francisco.

The information in this article is general in nature, and is not intended to constitute legal advice or to create an attorney-client relationship with respect to any event or occurrence, and may not be considered as such.

Copyright © 2008 by Tuttle Law Offices. 

All rights reserved.  Information has been obtained from sources believed to be reliable.  However, because of the possibility of human or mechanical error by our offices or by others, we do not guarantee the accuracy, adequacy, or completeness of any information and are not responsible for any errors, omissions, or for the results obtained from the use of such information.

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