W Coast Trade Symposium recap: E-commerce is THE hot topic

2017 w coast trade symp


CustomsNow attended CBP’s West Coast Trade Symposium last week in Phoenix.  The theme was “Looking Ahead Together: What’s Next for Trade?”  Generally, CBP stated that they would continue to focus on the Priority Trade Issues, as well as the Executive Orders issued by the Trump Administration in 2017.

CBP also intends to build on the foundation of ACE to perform smarter targeting of inbound cargo and will be working to reduce the amount of regulations as required (for every new regulation two must be eliminated.)

Finally, CBP is struggling to stay on top of the explosive growth in the number of small packages shipments driven by e-commerce.

E-commerce is clearly a pressing issue for CBP and here is why:

  • E-commerce sales were valued at $3.4B on Black Friday and are expected to exceed $500B annually by 2020
  • 52M small packages are shipped annually via express carriers
  • 130M small packages ship via air cargo
  • 275M small packages ship via the mail.  This compares to 100M in 2010, up 20% year over year
  • In a recent 5-day operation at JFK airport, CBP checked 3000 mail packages and seized over 1500 due to Intellectual Property Right (IPR), Agriculture, and illegal drugs reasons.  The operation was halted in just 3 days due to the sheer number of seizures.

CBP is just not staffed to handle and examine this volume of packages and they are trying to overcome this shortfall.  For instance, CBP will be piloting a program in Dallas whereby any small package shipments that need to be examined will have to be delivered to a Centralized Examination Station (CES) as opposed to CBP inspectors driving to the various air carrier facilities.

It was explained that most air and express carriers do a good job of prescreening their shipments to the US to ensure they are compliant with US laws and regulations.  Therefore, the criminals are turning to shipping via the mail since there is no prescreening performed at present.

The United States Postal Service is not required to provided CBP with advanced data that would allow CBP to target suspect shipments as they do with all other modes of transportation.  The STOP Act, which is working its way through congress, will address this deficiency.  The Global Direct Entry program is also helping the postal service to identify Trusted Traders for certain wholesalers so that CBP can concentrate on those shippers which are not in this program.

Another concern is that many of these packages fall under the $800 de minimis amount, also known as a Section 321 entry, and, therefore, do not have to be entered with CBP.  The intent of the de minimis rule is that a formal entry must still be made if “additional information, bonding or protection is required.”  Many shippers ignore this requirement and are therefore not declaring their drug shipments to the appropriate Partner Government Agency (PGA), specifically the FDA.

CBP is very concerned with the increase in small packages moving via the mail that contain Fentanyl, a very dangerous synthetic opioid and they shared this story.  Recently an Inspector brushed the lapel of his uniform to remove a substance.  He later overdosed on Fentanyl but, thankfully, survived. CBP is looking at utilizing spectrometers to examine small packages.  This would allow them to screen for illegal drugs without having to open the packages.

Incidentally, the only way, presently, to declare a Sec. 321 shipment to CBP is via the manifest.  E-commerce providers want the ability to declare them via ABI and CBP is investigating this option.  CustomsNow learned that the Trade Leadership Council is considering the creation of a new entry type code of ‘86’ for Sec. 321 shipments.  This way the appropriate PGAs can be declared and there will be no duties or fees due to CBP (in 2010 Congress estimated that if the de minimis amount was raised to $1,000 that would result in only $42M in lost revenue compared to the total amount of duties paid annually which was $37B in FY 2015.)

In addition to illicit drugs, CBP is focused on IPR infractions (“If you can make it, the criminals will fake it.”) It is estimated that companies involved with IPR employ 42M Americans and constitute 40% of our GDP.  Unfortunately, there were 32K IPR seizures last year with an estimated value of $461B.  86% of these shipments came from China and that number climbs to 88% when you add in Hong Kong.  Many of these shipments move as small parcel.


Free JOC webcast: Case study of Top 100 importers

container shipThe annual Top 100 Importers and Exporters report is one of the most extensive products The Journal of Commerce produces. Based on exclusive research, it analyzes the largest global companies shipping containerized goods to and from the US — essential information for shippers, carriers, and third-party logistics providers.

This webcast, the first in a two-part series, will analyze the makeup and dynamics of the Top 100 US Importers and the factors driving inbound trade. It also will look ahead to the rest of 2017 and the regulatory, economic, and transportation issues US importers face.

Thursday, June 15th at 2pm EDT (75 minutes)


Target CEO blasts border adjustment tax at House hearing: ‘Americans will pay more’


From RetailDive.com:

  • The House of Representatives’ Ways and Means committee on Tuesday called on five experts — including Target CEO Brian Cornell and former President/CEO of Wal-Mart U.S. William Simon — to testify on the impacts of the Trump Administration’s proposed border adjustment tax in a hearing on the matter.
  • For Target, the proposed 20% border tax on imports would cause the big-box retailer’s tax rate to more than double from 35% to 75%, Cornell said Tuesday.
  • In contrast to many in the retail industry, William Simon, a retail and consumer products veteran who left his post as CEO of Wal-Mart U.S. in 2014 and is currently a senior advisor at private equity firm KKR, argued the border adjustment tax is in the best interests of the country — and the retail industry — if “properly implemented.”

Read full article.

Register now for reduced rate for 2017 G.TEC event in Long Beach!


There’s still time to register for the reduced, advance rate for NCBFAA Educational Institute’s 2017 Global Trade Educational Conference (G.TEC)! This year’s event will be held August 7-8 in beautiful Long Beach, CA.  G.TEC gathers professionals from all facets of the industry-regardless of membership or affiliation-for two days of educational sessions and networking.

CustomsNow is proud to be a Gold Sponsor of the event!  And our CEO, Karin Smith, is participating in a panel of interest to importers and others in the trade:  Self filing vs. Broker filing, Challenges, similarities, etc.  See other hot topics on the agenda.

If you have any questions about attending or sponsoring the conference, please contact NEI Director Cecilia Ferrara.

Don’t wait–register by June 30 to join us for the advanced rate!




CBP clears up guidance for air split shipments


In CSMS #17-000279, US Customs has clarified the process for air split shipments:h

  • CBP regulations require that all cargo arriving on split conveyances be entered in the air manifest system. The carrier is required to manifest the air waybill, in accordance with the CAMIR, as a split with the data for each conveyance and any in-bond transaction to move the cargo to the same entry port.
  • Cargo moving on the same air waybill but not declared in the ACE air manifest system as a split, is not eligible for split entry processing. As such, one entry per conveyance is required. This applies to a single house air waybill split across multiple master air waybills.
  • ACE currently does not have an edit to enforce this policy. ABI filers can determine if a carrier’s air waybill was split by submitting a cargo manifest entry release query (CQ transaction). Split air waybills will have a part indicator A, B, C, etc. in the response message.
  • It is the filer’s responsibility to ensure that cargo on a single bill of lading, moving on multiple conveyances, and not declared as a split are entered separately.

Free supply chain fraud & integrity webinar tomorrow 5/17

USFIA logo_CMYKFrom our friends at the United States Fashion Industry Association:

International supply chains are made up of a diverse range of actors including contract/joint-venture/owned manufacturers; transportation providers, warehouse operators; customs brokers; and related and third party distributors. Cases of bribery, misappropriation of funds, smuggling, and customs fraud can have a very significant financial and reputational impact on a company.

USFIA’s Premier Partner PwC will share their experience on supply chain and anti-bribery compliance, business partner management, and thoughts on how technology could be used to assist on this.

NOTE: This webinar will take place at 8:30 AM ET to accommodate our speakers in China. This webinar will be recorded and distributed to everyone who registers–so register even if you can’t join live!

May 17th, 2017 8:30 AM through 9:00 AM
Online via Go2Webinar
Phone: 202-419-0444
Email: info@usfashionindustry.com
USFIA Member (Must Have Valid Member Company Email Address) $ 0.00
Non-Member Brand, Retailer, Importer, or Manufacturer $ 0.00
Non-Member Service Provider $ 95.00



Importer’s lament: “Why isn’t my release visible to my carrier?”


Nic Adams
Nic Adams

Nic Adams, CustomsNow’s Vice President, Client Services, offers guidance for importers who are frustrated that their carriers don’t seem to have visibility to shipment releases even when there is a CBP release on the cargo:

I have a Customs release, and a 1USG, but my carrier says my shipment isn’t clear.  I know I referenced the correct I.T. and Bill of Lading numbers on my entry (I didn’t receive any responses from CBP indicating a No Bill Match.)  Why isn’t my release visible to my carrier?

We often receive this question from our clients.  Invariably, it involves a shipment that is moving In-Bond via truck or rail.

After receiving the Arrival Notice with the I.T. information, the client enters the appropriate information into our ABI system and transmit the entry to CBP.  Normally the cargo responses come back in this order:

  • SE DATA ACCEPTED  (SE=Simplified Entry)
  • RELEASED (along with a Release Date which is the expected ETA at the inland port)
  • DATA UNDER PGA REVIEW (for shipments subject to a PGA such as FDA)
  • MAY PROCEED (along with a ONE USG meaning the shipment has cleared CBP and any/all relevant PGA’s)

At this point, most our clients will then query the bill of lading in the Automated Manifest System to ensure the release has posted to the bill of lading and that, therefore, the carrier has visibility to the release (a release is posted against a bill of lading in AMS with a code of ‘1C’).

But, no release has been posted.  Why is that?  The reason is that CBP posts releases to the carrier’s manifests based on different factors.  These rules can be found on page 17 of US Customs’ ACE Cargo Release Business Process document:

CBP sends a notification of release to the filer, carrier, and the terminal facility/custodian as appropriate… That information is sent at different times for different modes of transportation.

  • Land Border (Truck and Rail) – at time of arrival (may be sent earlier in rail depending on location)
  • Ocean – as early as 5 days prior to the estimated date of arrival
  • Air – as early as 4 hours prior to the estimated date of arrival

The key for truck and rail shipments is that the shipment must be arrived… not just physically arrived but deemed “arrived” in AMS.  This means that the In-Bond status must be updated from ER (en route) to AR (arrived.)  Then, and only then, will the 1C be posted to the bill of lading.  It is not uncommon that carriers do not ‘arrive’ their In-Bonds timely and, in this case, we advise our clients to contact the carrier and request that they arrive the In-Bond so the customs release can post.

Please contact Nic if you would like to discuss this topic in more depth.





ACE Portal: Updated CBP guidance for veterans and newcomers


US Customs has updated web content to help users better understand the ACE Secure Data Portal —  perfect for members with existing portal access, and new trade members who are looking to gain access to the ACE Portal.

The new content will help ACE Portal users have a better understanding of the account process and to address frequently asked questions.  Note that none of the new content affects the structure of existing ACE Portal accounts.

And here’s a helpful one-sheet overview (click to expand):

ACE Basics - Portal Account

EPA imports: New enforcement of HTS flagging kicks in on 5/18

From CSMS #17-000253:

On May 18, 2017, the Harmonized Tariff Schedule (HTS) flagging for all Environmental Protection Agency programs for all filersEpa-Logo will be enforced. Once the flags are enforced, the filer will either need to file the required information electronically using the PGA message set or disclaim using the appropriate code.

Reminder from EPA: The importer is responsible for knowing what to file, regardless of whether a tariff code has been flagged.

For questions regarding which imports require which EPA filing requirements, contact the following:

  • V&E Hotline: imports@epa.gov
  • TSCA Hotline: tsca-hotline@epa.gov
  • Pesticides Regional Import Coordinators: See CBP guidance