February 2009 - Issue 33   

IN THIS ISSUE:

"Good Importer Practices" draft guidance document issued by Federal Agencies

ISF/10+2 Update



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"Good Importer Practices" draft guidance document issued by Federal Agencies

A group of federal agencies consisting of the United States Department of Agriculture, Department of Commerce, Department of Health and Human Services (Food and Drug Administration), Department of Homeland Security, Department of Transportation, Consumer Product Safety Commission, Environmental Protection Agency, and the Office of United States Trade Representative has created a draft guidance document titled, "Good Importer Practices."

This guidance document is intended to provide general recommendations to importers on possible practices and procedures they may follow to increase the likelihood the products they import are in compliance with applicable U.S. safety and security requirements.

The draft guidance document is being distributed for comment purposes only, and it is requested that all written or electronic comments on the draft guidance are submitted by April 12, 2009 to ensure that the agencies consider the comment on this draft before work begins on the final version.

These "Good Importer Practices" are broadly organized under four guiding principles:
  • Establishing a Product Safety Management Program;
  • Knowing the Product and Applicable U.S. Requirements;
  • Verifying Product and Firm Compliance with U.S. Requirements throughout the Supply Chain and Product Life Cycle; and
  • Taking Corrective and Preventive Action When the Imported Product or Firm Is Not Compliant with U.S. Requirements.


This document provides principles and recommendations that may apply to imported products generally, and will help ensure that federal agencies and importers adopt a consistent approach. Individual agencies may issue more specific guidance directed at particular product categories to provide more targeted and detailed recommendations.

To read the full draft guidance document, please visit the following link:
http://www.fda.gov/oc/guidance/goodimportpractice.html

ISF/10+2 Update

The ISF/10+2 rule is now operational with CBP sending electronic responses to the data transmitted. CBP stated early in the rulemaking process that they understood the impact this rule would have on international business and promised that the rule would have a phasing in period to lessen the shock of the changes.

As noted in previous AIT eNewsletter articles, although the system was live as of January 26, 2008, CBP will "show restraint in enforcing the rule" for at least twelve months from that date. This one-year grace period is due in part to CBP responding to comments from the trade community.

One of the concerns sent to CBP is that full compliance with the rule as it pertains to the international movement of ocean freight can require a restructuring of the flow of information and documentation from shipper to importer. Information that might not have been available to the importer (or their agent) until well after the shipment has left on the vessel from the port of exportation will now be required to have been received and transmitted to CBP no later than 24 hours prior to the freight being laden onto the vessel.

Other notable concerns involving 10+2 include the confidentiality/security of privileged information, the party responsible for filing, authorized agents and powers of attorney, Customs bonds, exemptions or special handling of various products and shipment/entry types, correcting, amending, or canceling filings, and penalties for non-compliance, to name a few.

It is in our best interest to use the period of delayed compliance to fine-tune all applicable processes and make sure that we can be 100% compliant when full enforcement begins. The process of collecting the required information and transmitting it to CBP can involve a number of parties (the importer, the overseas vendor/seller, the shipper, the party who stuffs the container, etc), but ultimately it is the ISF importer who is the responsible party (according to CBP). While most of the parties in the supply chain are involved, it is the ISF import whose freight will be delayed, and it is the ISF importer who would be responsible for fines if the transmission is late or inaccurate.

In dealing with ISF/10+2, the main objective is to make sure that all the involved parties are aware of the new requirements and they work together to make sure that accurate information is available for timely transmission to CBP. The ISF importer and their ISF filing agent must be aware of all pending orders/shipments so that no shipment arrives at the dock to be loaded onto a vessel without ISF/10+2 having been transmitted. After full enforcement begins, that shipment would have "do not load" status from CBP, would be refused loading privileges by the vessel carrier, and would sit accruing storage/demurrage on the dock or nearby warehouse until the a valid ISF/10+2 transmission has been received by CBP.

To comply with the requirements of this rule requires teamwork between all involved parties. AIT has purchased the software necessary to transmit the ISF data elements to CBP and that ability is integrated into our customs brokerage system. We have contacted all of our overseas agents and advised them of the requirements of the ISF/10+2 rule. AIT is positioned to assist with compliance to the requirements of this new rule.

Since ISF/10+2 is an "interim final rule," CBP has not finalized all parts of the rule. As the 12 months of deferred enforcement progress, we will be sure to report all updates regarding any amendments or changes to the rule and processes involved with it.


Please refer to the following "crash course" for some "basic" ISF/10+2 information:

There are 3 definitions:

  1. 10+2 is the Importer Security Filing (ISF) and Additional Carrier Requirements.
  2. ISF is called "10+2" because those are the number of data elements that the importer (10) and ocean carrier (2) must transmit to CBP (Customs).
  3. The ISF importer is defined as "the party causing the goods to enter the limits of a port in the United States."
  • The most important fact to remember is that "10 +2" is required only for freight that will be laden onto an ocean vessel that will then be arriving at a US ocean port.
  • There are 10 data elements that are the responsibility of the ISF importer and 8 of them must be received by Customs at least 24 hours prior to the freight being laden onboard the vessel that will bring it to the US port.
  • The data elements can be sent to Customs by the ISF importer or their authorized agent, but a filer must be capable of transmitting the data to Customs via an approved electronic interface. All updates must be filed by the same party who initially transmitted the 10 ISF elements.
  • An agent filing on behalf of an ISF importer must possess a valid POA "in English" from the ISF importer.
  • AIT CHB has the capability to transmit ISF data to Customs. We purchased the applicable module from our CHB software vendor to make this possible.
  • There must be a continuous Customs bond associated with the data transmissions. It can be held by either the ISF Importer or their agent. "If the ISF importer does not have one of the designated bonds, the party must obtain a bond or designate a bonded agent to file under the agent's bond if the agent agrees in writing." The ISF importer is ultimately responsible for the timely accurate submission of ISF data elements, and any liquidated damages will be guaranteed by the bond that was associated with the data transmission.


The full 10 elements that apply to "shipments intended to be entered into the U.S. and shipments intended to be delivered to a FTZ (foreign trade zone)" are as follows:

  1. Seller
  2. Buyer
  3. Importer of Record Number (IRS/EIN)
  4. Consignee Number (IRS/EIN)
  5. Manufacturer or Supplier
  6. Ship to Party
  7. Country of Origin (manufacture)
  8. HTSUS (at least 6 digits)
  9. Container Stuffing Location
  10. Consolidator (container stuffer)


  • Elements 1-8 must be filed 24 hours prior to being laden onboard the vessel; elements 9-10 must be filed 24 hours before arrival at the US port of unlading.
  • Information in elements 1-4 must be updated if changes occur or more accurate information is available prior to arrival at a US port.
  • Information in elements 5-8 can be initially filed based on the best available information. The information in these elements must be updated as soon as more accurate information is available, in no event later than 24 hours prior to arrival at a US port.
  • The ISF data will be linked to Customs manifest data via the "11th element," the BL, and ISF's must be filed at the lowest BL level. Only a straight BL or HBL will be accepted; a sub-HBL will not be accepted by CBP.
  • The data elements can be filed any time prior to the deadline as long as all of the required data elements are available. This would usually be after the BL has been created. Customs entry can be pre-filed at the same time as ISF, but there will be no special provisions for pre-filing a Customs entry if the shipment is moving on an IT to an inland port. If Customs entry is pre-filed with ISF, then the filing agent must be a licensed Customs broker. The filing of ISF alone does not constitute "customs business."
  • CBP will transmit an electronic acknowledgement only to the filer when the ISF is received. This acknowledgement will include a unique identification number. Any updates must reference the ID number.
  • Per CBP, "the status of a shipment as 'perishable' or 'non-perishable' does not necessarily indicate increased or decreased security risk." There will be no special procedures for agricultural (or any other "perishable") products.
  • Personal Effects, Carnet, TIB shipments, samples, and trade show displays are not inherently less of a risk than other shipments and will not be exempt from these regulations. Since returned/refused cargo has been out of the control of the exporter and CBP, it will not be exempt from these regulations.


U.S. companies that are "drop" shipping to a location in a third country may need to be aware of the following:

Since security issues apply to all freight that has been laden onto ocean vessels that enter US ports, there are separate requirements consisting of only 5 required elements for shipments that are not intended to be imported into the US. This is for Freight Remaining On Board the ocean vessel (FROB) or IE / T&E shipments intended only for export. Transmission of these elements would be the responsibility of the carrier for FROB freight and the party filing the inbond documentation for IE / T&E freight.

The 5 elements are:

  1. Booking Agent
  2. Foreign Port of Unlading
  3. Place of Delivery
  4. Ship to Party
  5. HTSUS (6 digits)


These elements are required any time prior to lading onboard the vessel at the foreign port.


If you have any questions or comments regarding the Compliance eNewsletter,
please contact Paul Codere from the Customs Brokerage Department.
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