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New Customs Rules Impact NPES Member Importers

On January 26, 2009 new U.S. Customs & Border Protection (CBP) Interim Final Rules (IFR) went into effect. The so-called “10+2” rules will require NPES members and importing manufacturers in other industries and carriers to provide additional cargo and vessel data to CBP prior to loading ocean shipments destined for the United States. The new rules aim to enhance CBP’s ability to target high risk ocean shipments bound for the U.S., and to provide additional security measures to thwart terrorist activities and threats.

Specifically, the new rules require importers or their agents to provide to CBP ten additional data elements, to be known as a “security filing.” They include: 1) seller, 2) buyer, 3) importer of record number/FTZ applicant identification number, 4) consignee number(s), 5) manufacturer or supplier, 6) ship to party, 7) country of origin, 8) Harmonized Tariff Schedule of the United States (HTSUS), 9) container stuffing location, and 10) consolidator (stuffer.) Carriers are now required to provide two additional data elements: 1) vessel stow plans, and 2) daily container status messages.

The new rules are an outgrowth of CBP’s and the Department of Homeland Security’s advanced cargo screening efforts under several earlier statues and initiatives.  In reviewing the IFR the Office of Management and Budget determined that approximately 11 million import shipments conveyed by 1,000 different carriers operating 37,000 unique voyages or vessel trips for delivery to between 200,000 and 750,000 importers in the United States will be affected by the new rules.

In the post-9/11 world U.S. Customs & Border Protection rules have the dual mission of both securing and facilitating trade for NPES members and importing manufacturers in other industries.  During the development of the new “10+2” rules the business community raised concerns that some requirements failed to properly balance these two important interests and needed to be recalibrated. Specifically, stakeholders cited increased cost due to estimated two to five day delays in the import supply chain—of particular concern to firms employing just-in-time manufacturing practices—as well as the fact that the new rules would treat all importers the same, regardless if they are trusted shippers, members of Customs Trade Partners Against Terrorism, or first-time shippers.

In response to these and other concerns, the IFR provides a 12-month phased-in flexible enforcement period during which CBP will show restraint in enforcing the rules, so long as importers are in good faith making satisfactory progress toward compliance. Moreover, the IFR opens a new public comment period until June 1, 2009 for the following six importer security filing data elements: container stuffing location name and address, consolidator name and address, manufacturer (supplier) name and address, ship to party, country of origin and commodity HTSUS. Additionally, penalties for violations are reduced.

 The complete IFR from the November 25, 2008 Federal Register is available online at: pending.  In preparation for compliance, NPES member should seek advice from qualified counsel on how to navigate the new requirements. Examples of topics to consider include: confirming powers of attorney, notifying overseas vendors of the new regulations, renegotiating contracts if necessary to insure that shippers provide required information on a timely basis, and developing a master file of all HTSUS commodity classification data.

For more information contact NPES Government Affairs Director Mark J. Nuzzaco at phone: 703/264.7235, fax: 703/620-0994 or e-mail: