Editor’s note: This is an article written by Robert Stein, Director of Entry Services at our Syracuse office. He has been a licensed U.S. Customs Broker for 11 years.
Everyone wants to know how the new security filing, known as “10 + 2”, will affect the way that they conduct business. Much is still unknown because the final ruling has yet to be published and the comment period is still open. U.S. Customs and Border Protection (CBP) will continue taking comments on the proposed rule until March 3, 2008.
The following is a primer on what the 10+2 Security Filing is, why it was created, and how it might affect the handling of import shipments.
Why must there be new security filing rules?
To improve CBP’s ability to identify high risk shipments being imported into the U.S., to prevent the smuggling of terrorist weapons into the U.S., and to ensure cargo safety and security.
The proposed regulations are intended to fulfill the requirements of the Security and Accountability for Every Port Act of 2006 and the Trade Act of 2002, as amended by the Maritime Transportation Security Act of 2002.
What is the “Importer Security Filing”?
The current proposal requires an Importer Security Filing (ISF) for nearly all shipments. This ISF includes ten data elements for each good listed at the six-digit Harmonized Tariff Schedule level and at the lowest bill of lading level—unless exempted.
In addition to the ten data elements, the ISF must include two carrier data elements (hence the “10 + 2” designation): (1) a vessel stow plan, which includes information about the physical location of the cargo loaded aboard the vessel and (2) container status messages, which report container movements and status changes.
The ISF must be submitted through CBP’s Automated Broker Interface (ABI) and Vessel Automated Manifest System (AMS). While the ISF must be filed 24-hours prior to vessel loading, the Container Status Messages must be transmitted no later than 48-hours after departure from the last foreign port.
What are the ten data elements in the ISF?
- Manufacturer (or supplier) name and address. The name and address of the entity that last manufactures, assembles, produces, or grows the commodity. If that is not known (and cannot be determined or does not apply), then the name and address of the supplier of the finished goods would be reported (this information would be used to create the manufacturer’s identification for entry purposes);
- Seller name and address. The last known entity by whom the goods are sold or agreed to be sold. If no sale is involved, then the name and address of the owner would be reported;
- Buyer name and address. The last known entity to whom the goods are sold or agreed to be sold. If there is no sale, then the name and address of the owner would be reported;
- Ship to name and address. Name and address of the first deliver-to party scheduled to physically receive the goods after being released from CBP’s custody;
- Container stuffing location. Names and addresses of the physical locations where the goods were stuffed into the container;
- Consolidator (stuffer) name and address. Name and address of the party who stuffed or arranged for the stuffing of the container;
- Importer of record number (IRS number). For goods intended to be delivered to a Foreign Trade Zone, the IRS number, EIN, SSN, or CBP assigned number of the party filing the Foreign Trade Zone documentation with CBP;
- Consignee IRS numbers;
- Country of origin. Country of manufacture, production, or growth of the article (based on the import laws, rules, and regulations of the U.S.); and
- Commodity Harmonized Tariff Schedule (HTS) number. This would be required at the six-digit level but allowed to be reported at the 10-digit level. This number could be used for entry purposes only if provided at the 10-digit level.
What do I do if my shipment information changes after the ISF is filed?
The ISF filer would be required to update the filing if there were changes to the shipment information or more accurate information became available and the goods had not arrived within the limits of the U.S. port. The ISF may be withdrawn when a shipment is no longer intended to arrive within the limits of a U.S. port.
Who will submit the ISF?
Under the current proposal, there are three parties that can file the ISF: a licensed Customs broker, a foreign freight forwarder, and an importer. Regardless of who files the ISF, the importer will be held responsible for the timely, accurate, and complete submission of the ISF.
If a licensed Customs broker files the ISF, and the Harmonized Tariff Schedule information is submitted at the 10-digit level, then the ISF may be used as part of the entry filing.*
*Please note that the current proposal does not allow the filing of the customs entry in lieu of the ISF. This is ironic since the type of detail being requested on the ISF is already present in a Customs entry filing. Importers will now essentially be responsible for two entry filings!
What if all the required elements are not known at time of ISF filing?
There has been concern that certain types of shipments, such as carnets, DDU/DDP shipments, consigned goods, returned goods, and samples may not have all the information available for a timely ISF filing.
Under the current proposal, CBP has not made any allowances for these transactions: All information for these types of transactions must be filed on the ISF within the same time frame as all other transactions (at least 24 hours prior to vessel loading).
CBP has stated that if the importer believes that a required ISF data element does not exist for a non-exempt transaction type, the importer should request a ruling prior to the time required to file the ISF.
My company is Tier 3 C-TPAT validated. Is my company exempt from having to file the ISF?
Tier-3 C-TPAT members will NOT be exempt from the ISF requirement, nor allowed to submit fewer data elements. Regardless of the parties involved, all cargo arriving to the U.S. by vessel, will be subject to the ISF requirements. This will allow CBP to use ISF data to assess the risk of individual shipments.
I have more questions about “in-bond” shipments as well as Foreign cargo Remaining On Board (FROB). Who can I talk to?
We have experts on staff who will help you with information on 10 + 2, as well as many other topics, such as import and export compliance, NAFTA, Incoterms, and much more. Call or email us today.
Robert Stein, Director of Entry Services
Syracuse: (315) 455-3003
Rochester: (585) 426-0340
Albany: (518) 690-7880