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CBP is embarking on one of the first ever Centers of Excellence and Expertise (CEE) customer satisfaction surveys. The CEEs are the "virtual" ports that offer one-point processing for participating accounts. Information gathered in this survey will be used to obtain facilitation priorities by CEE and assess the efficiency of the CEE’s facilitation efforts. Recognizing that information resides in many different areas, we ask both importers and non-importers to respond (NOTE to non-importers: Please respond with your collective / average client base in mind).
The survey consists of multiple-choice questions that request information on CEE interaction, and it takes only 20 minutes to complete. CBP is asking for responses by Wednesday, March 13th. Keep in mind, the survey is anonymous and the results are stored in a secure web-based survey tool.
The survey can be accessed by clicking here or on the below link. Please feel free to forward this link to your network. We wish to achieve feedback from the widest possible audience in order to get the most comprehensive input on CBP's CEEs.
http://www.surveyshare.com/s/AQAM4SD
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Shrinking the Regulatory Haystack
CBP Centers for Expertise and Excellence
By Rick Eyerdam –
The federal regulators call it Trade Facilitation and its center piece is a new test program that assigns each of the 10 related sections of the Harmonized Tariff to a national Center of Excellence and Expertise (CEE) for improved post-entry processing using an account-based approach.
At each of the 10 CEEs the expert staff replaces the involvement of the 300 or so port directors at Customs ports of entry after imported products are released. This segments risk allowing the Port Directors to focus more exclusively on security concerns, according to CBP. (see box) According to CBP documents, “the issuances of all requests for information and notices of action, extensions and suspensions of liquidations, and reviewing and acting on protests will be performed by the CEE director rather than the port director.”
Miami will host the CEE for all imported Agriculture and Packaged Goods which are contained in the first 24 chapters in the vast Harmonized Tariff document. The Textiles and Apparel CEE will be based in San Francisco.
Already CEEs have been established in Detroit for Automotive and Aerospace; Houston for Petroleum, Natural Gas and Minerals; Long Beach for Electronics and New York for Pharmaceuticals.
Their operating rules were published at 52048 Federal Register / Vol. 77, No. 167 / Tuesday, August 28, 2012 / Notices. The Agriculture and Packaged Goods CEE that is slated to begin by September of 2013 will be a blessing for Miami International Airport which is by far the major agriculture importing hub – greater than 85%- in the nation; and to a lesser extent to PortMiami.
John P.Leonard, (pictured above at a planniing session) Acting Executive Director of Policy and Trade Programs at CBP told CNS Focus. “The CEE will enhance the expertise that Miami currently has in agriculture goods, which is one of the reasons why the CEE is located in Miami. Additionally, it takes the expertise currently in Miami and gives it a national focus, so for participating importers, no matter if their agricultural shipments are brought into Atlanta or Lorado, the Miami CEE will be responsible for processing these entries.”
“The Centers bring benefits for all importers who import in any mode of transportation,” Leonard said.“It doesn’t matter how the goods get into the country whether by air, sea, truck, train; the Centers will serve them all equally. We will bring as much value to the air cargo world as we will the vessel container world.”
Instead of dealing with each individual Customs entry, Leonard said, the Centers of Expertise will deal with the importer of record as a distinct client with a corporate account for each category of imported goods. “If you are ABC Company, Inc. and you regularly import fruit and apparel at several ports across the country, you will have an account at the CEE in Miami for the import of agriculture and another at the CEE in San Francisco for the import of apparel,” Leonard explained. “When you have a hitch in the release of your shipment, a missing document, you call up your account representative at the appropriate CEE and work out the difficulty,” Leonard said. “Instead of dealing with scores of different interpretations of the import regulations at scores of different ports of entry, each with a different port director, the importer of record deals only with the staff at the appropriate CEE,” Leonard explained. “Once a problem is identified in the process and the issue resolved, the resolution becomes a template that prevents the same thing from slowing release of identical cargo imported by the same importer in the future,” Leonard said.
At least for the current test period with the four established CEEs, the Federal Register says, “Decisions made by a CEE which are within the authority granted under this test shall govern the transactions to which they pertain; test participants may not seek to have such decisions referred to a Port Director or another CEE Director.
Why the fundamental change? Shrinking the Haystack
Since the air attacks of 9/11 the Department of Homeland Security’s front line agencies, Transportation Security Administration (TSA) and CBP, Customs and Border Protection have ramped up the importation process over trying to accomplish the essential goal of preventing another terrorist attack – a needle in the haystack of trade – while enforcing thousands of trade related laws without crippling the flow of imported goods.
Trade is more ponderous, all would agree, and it is certainly safer. A generation later the CBP has finally come up with an adequate description of its intended goals: make the haystack smaller. For both CBP and the importer the haystack is that jumble of federal laws, rules and regulations, the trade agreements and differing practices among the 300 plus Customs ports of entry stacked against the free trade practices, filing short cuts, floor tiles filled with coke, knock-off designer goods and down-right dangerous products imported as if they are safe and legal.
As Leonard told CNS Focus, after much thought and many trials and error, Customs plans to work directly with the importers of record to expedite release of imported products and thus save importers time, money and that precious freshness.
To accomplish that goal Leonard and Deputy Customs Commissioner David V. Aguilar turned to the COAC (Advisory Committee on Commercial Operations of Customs and Border Protection better known as COAC ) and its Trade Facilitation Subcommittee to establish baseline industry metrics especially metrics of time delays, man hours and real costs.
Leonard explained, “This benchmark can then be used to determine what facilitation benefits “save” the industry, and therefore can have a bearing on key partnership benefits CBP can offer the Trade.” COAC conducted this benchmarking survey in June 2012 to measure how effective CBP’s current trade facilitation efforts are at lowering the cost and burden associated with a company’s compliance and operations efforts.
The survey was also designed to capture trade priorities that can be used by CBP to provide meaningful partnership benefits and employed in the CEE process.
The results were mixed. From the survey, highlights include:
• The Majority of respondents were with companies filing anywhere from 100 to 99,999 entries per year.
• As prioritized by businesses, CBP’s facilitation efforts should be focused on reducing CBP processing times, CBP holds, exams, and PGA (participating government agency) processing times. • A majority of companies spend up to 14 hours managing the lifecycle of a single entry.
• A one-day delay in the release of merchandise costs companies over $700 for each affected shipment.
• The first 24 hours is critical to resolve CBP or PGA freight holds or exams; thereafter, respondents revealed multiple days.
• The survey was favorable to CBP’s responsiveness to addressing issues, indicating a good level of customer service at the ports when issues arise. Specifically, 53% of the respondents stated that most issues are communicated in 30 minutes or under, and over 90% of the time the respondents have stated that the end result was positive versus a 9% “not-positive” response.
• 90% of respondents indicated their ability to file all required data electronically for U.S. imports was a very important issue for the Single Window to resolve. (The Single Window system enables importers or their agents to submit regulatory documents only once in one place.)
These regulatory documents are typically customs declarations, applications for permits, certificates of origin, trading invoices, etc.
Costs & Holds
The results of the COAC study show that there is not much difference when it comes to the element of time between a CBP hold or exam and a PGA (participating government agency) hold. In addition to the element of time, it seems that the first 24 hours is critical is trying to resolve the issue, after a 24 hour time period the element of time can get extended to multiple days. Direct costs for the exams can get quite expensive.
While 42% of the respondents revealed their costs of an exam were under $500, another 40% told said that their costs were more than $700. Indirect costs to the supply chain for a hold/exam split respondents: 51% revealed that when a shipment is held for a hold/exam impacts to their daily supply chain costs more than $700; 49% have comments that their costs are under the $700 cost on a daily basis.
Costs associated for processing entries, as indicated by a majority of respondents, were less than $299 per entry for internal costs and less than $299 for external costs. Time associated with managing the lifecycle of a single entry was up to 7 hours internal and up to 7 hours external.
Improving any of these metrics assures a real benefit to all parties in the supply chain especially the importer of record, according to Leonard. And the CEE system is the new method of choice. The threshold for participation as explained in the Federal Register require an Importer of Record number, enrollment in the CTPAT (Customs Trade Partnership Against Terrorism) program as Tier 2 or Tier 3 members and completion of the ISA; Importer Self-Assessment process.
Leonard said participation in Air Cargo Advance Screening is always beneficial but it is not associated with CEE participation, which focuses entirely on post release issues. Leonard explained that the port directors at ports of entry will remain in control of all the pre-clearance functions currently under their jurisdiction.
“Once the goods are released the required entry documents and certain revenue-related functions, such as requests for computed value information, waivers of invoice requirements, issuances of all requests for information and notices of action, extensions and suspensions of liquidations, and reviewing and acting on protests will be performed by the CEE director rather than the port director.”
“We need to increase the already noteworthy voluntary participation level in the automated and pre-clearance programs especially CTPAT and ISA,” Leonard said. “Now we can demonstrate the value of participation beyond shrinking the haystack to find that needle of Terrorism. We can show value that is both a benefit to the importer and to the gross national product.”
The centers that to be established in FY 2013 are: 1. Agriculture & Prepared Products: Miami 2. Apparel, Footwear & Textiles: San Francisco 3. Base Metals: Chicago 4. Consumer Products & Mass Merchandising: Atlanta 5. Industrial & Manufacturing Materials: Buffalo 6. Machinery: Laredo
Role of the importer of record Customs requires that the importer of record have a certain level of financial interest in the import transaction so as to ensure that the importer of record, as the person liable for the import transaction, also has an interest in the goods themselves. Since Customs maintains authority over goods crossing the borders, this requirement of a financial interest in the transaction helps ensure that the importer of record will be responsive to Customs in terms of compliance with duty payment and regulatory enforcement. It also ensures that the party entering the goods will have access to the documents necessary to establish the proprieties of the transaction in terms of proper valuation, classification, marking and other matters.
52048 Federal Register / Vol. 77, No. 167 / Tuesday, August 28, 2012 / Notices CBP’s goal is to incrementally transition the operational trade functions that traditionally reside with the ports of entry until they reside entirely with the CEEs. By focusing on industry-specific issues and providing tailored support for the participating importers, CBP is seeking to facilitate trade, to reduce transaction costs, increase compliance with applicable import laws, and to achieve uniformity of treatment at the ports of entry for the identified industries. CBP believes that providing broad decision-making authority to the CEEs for entry processing issues will better enable the CEEs to achieve these goals for CBP and the trade. Please note that 19 CFR 134.54(a) will be waived only to the extent to provide the CEE Directors with the authority to extend the number of days from the date of the notice of redelivery for the importer to properly mark or redeliver all merchandise previously released to him. The Port Director will continue to retain the authority for demanding liquidated damages incurred under the bond in an amount equal to the entered value of the articles not properly marked or redelivered.
CEE Determinations Not Requiring Regulatory Suspension
The following determinations do not require the waiver of regulations, but are determinations that would usually otherwise be made by the Port Directors, and will be made by the CEE Directors under this test: performing all validation activities; reviewing and processing of post entry amendments and post summary corrections; and fixing the final appraisement of merchandise, and fixing the classification and duty rate of such merchandise.
Processes That Will Change for Selected Test Participants
The following is a list of processes that will change for test participants effective upon the beginning of this test: • Requests for entry cancellations must be submitted electronically to the CEE; • Census resolution processes will be handled by the CEE, therefore, rejected ACS entry summaries must be electronically transmitted to the CEE’s email address, unless other arrangements have been made with the CEE to resolve Census issues; • Timely responses to Requests for Information (CBP Form 28) and Notices of Action (CBP Form 29) must be sent directly to the CEE; • Requests for Internal Advice must be submitted electronically to the CEE for further coordination with the Office of International Trade, Regulations and Rulings; and • Protests must be filed via the electronic protest module in ACS (including a note in the filing that designates the CEE team), or, submitted electronically on a scanned copy of the CBP Form 19 with all supporting documents to the CEE via the ACE Portal or the CEE’s email address.
Processes That Will Remain Unchanged For Selected Test Participants
Unless specified in this document or in the ‘‘Centers of Excellence and Expertise Test Guidelines’’ (CEE Test Guidelines), which will be posted on the web at http://www.cbp.gov/xp/cgov/ trade/trade_transformation/ industry_int/, all current processes will remain unchanged. For example, the following processes will remain unchanged:
• Quota entry summaries will continue to be processed by the ports of entry;
• The bulletin notice of liquidation (CBP Form 4333) will continue to be posted at the ports of entry;
• Revenue collection and the resolution of discrepancies in the amount of monies presented will remain with the ports of entry;
• Requests for further review and requests to void the denial of the protests will continue to be issued by Regulations and Rulings, Office of International Trade;
• Entry filers must continue to file Electronic Invoice Program (EIP) and Remote Location Filing (RLF) entry summaries as usual in the Automated Commercial Environment (ACE); and
• Entry filers must continue to submit entry summaries through the Automated Commercial System (ACS) or ACE and will not be required to change the respective port of entry.
ADDRESSES:
To submit comments concerning this test program: send an email to CEE@cbp.dhs.gov. In the subject line of an email, please use, ‘‘Comment on CEE test.’’ To apply to participate: submit a letter to U.S. Customs and Border Protection, Office of Field Operations, Trade Operations Division, 1300 Pennsylvania Ave., NW., Suite 2.3D, Washington, DC 20229, or an email to CEE@cbp.dhs.gov. The letter or email must include the name and contact information for the business interested in participating in the test, the business’s industry, and the business’s importer of record (IOR) number(s).
Rules Changes
All changes to procedures during the test will be posted in the CEE Test Guidelines two weeks before the change goes into effect. CBP will be posting the CEE Test Guidelines on the web to provide information regarding CEE operations. Test participants must check the CEE Test Guidelines on a weekly basis to determine: (1) How their responsibilities and required processes will differ from non-CEE participants and the effective date of the new responsibility or required processes; (2) whether the new responsibilities and required processes are being changed again and the effective date of the change; (3) whether there will be a change to any procedure that is required by CBP in a manner otherwise than by regulation, e.g., reconciliation test notice; and (4) when §§ 159.7 and 191.61 will be waived.
Trade Advisory Group Members
Leman Chip Bown, Jr., FedEx Trade Networks, Buffalo, N.Y. Scott Childers, The Walt Disney Company, Kissimmee, Fla. Colleen Clarke, Roanoke Trade Services, Inc., Schaumburg, Ill. Mary Ann Comstock, UPS Supply Chain Solutions, Sweet Grass, Mont. Jeffrey Coppersmith, Coppersmith Global Logistics, Inc., El Segundo, Calif. Robert DeCamp, A.N. Deringer, Inc., Rouses Point, N.Y. Matthew Fass, Maritime Products International, Newport News, Va. William Ferguson, NYK Line (North America) Inc., Jackson, N.J. Michael Ford, BDP International, Philadelphia, Pa. Carol Hallett, U.S. Chamber of Commerce, Washington, D.C. Donald Huber, General Electric Company, Ft. Myers, Fla. Karen M. Kenney, Liberty International, Inc., Pawtucket, R.I. Karen Lobdell, Integration Point, Chicago, Ill. Kathleen Neal, A.O. Smith Corporation, El Paso, Texas James Phillips, General Motors LLC, Detroit, Mich. Edward Ted Sherman, Target Corporation, Brooklyn Park, Minn. Barbara Vatier, Air Transport Association, Washington, D.C. David Vitale, Urban Partnership Bank, Chicago, Ill. George Weise, Sandler & Travis Trade Advisory Services, Leesburg, Va. Jeffrey Whalen, Nike, Inc., Beaverton, Ore.
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