ISF and eBond Updates from CBP - Avalon Risk Management CCBFA Presentation_March... · ISF and eBond Updates from CBP ... •ISF Enforcement Memo is being drafted to send to all Ocean

This presentation is not open to the press and has a legal Copyright © March 2014

ISF and eBond Updates from CBP Thursday, 3/20/14

http://www2.miq.com/


Introductions

Lisa Gelsomino, President/CEO, Avalon Risk Management

– ISF: NCBFAA ISF Sub-committee and various trade outreach

– eBond: ITSA, TSN eBond Subcommittee, COAC Bond Working Group

M. Craig Clark, CBP Headquarters, Washington DC

– Program Manager, Office of Cargo Conveyance & Security (OFO)

Kara Welty, CBP Revenue Division, Indianapolis IN

– Chief, Debt Management Branch, Revenue Division (OA)

Tina Jansen, VP Compliance & Import Operations, MIQ

– TSN Advisory Council, TSN eBond Committee

Celeste Catano, Senior Global Strategist, Kewill

– TSN Ambassador

– Industry Thought Leader



ISF Updates from CBP

M. Craig Clark Program Manager

Office of Cargo and Conveyance Security CBP Headquarters-DC


ISF Timeline

ISF Action Date

ISF Proposed Rule (NPRM) 01/02/08

ISF Interim Rule 01/26/09

“Flexible” Enforcement 01/26/09

“Informed Compliance” 01/26/10

ISF Enforcement 07/09/13

NPRM (ISF-5) TBA ISF Final Rule ETA of 8/14

CBP FAQ Update OR&R Review

ISF Document

1st notice of ISF bonds CBP 19CFR149(b)

CBP ISF Interim Rule

CBP ISF Web Page

CBP ISF Mitigation Guidelines

CBP CSMS Enforcement Message

Questions or comments to: [email protected]

CBP FAQ dated 07/09/10

http://www.reginfo.gov/public/do/eAgendaViewRule?pubId=201310&RIN=1651-AA98




http://www.ecfr.gov/cgi/t/text/text-idx?c=ecfr&SID=fda062394869788c89ad040f9ae54780&rgn=div5&view=text&node=19:2.0.1.1.9&idno=19

http://www.gpo.gov/fdsys/pkg/FR-2008-11-25/pdf/E8-27048.pdf

http://www.cbp.gov/border-security/ports-entry/cargo-security/importer-security-filing-102



http://www.avalonrisk.com/questnewsletter/news/mitigation.pdf

http://apps.cbp.gov/csms/csms.asp?srch_argv=13-000298&srchtype=all&opt=1

http://www.cbp.gov/sites/default/files/documents/10_2faq_0.pdf



ISF by the Numbers

January 26 – November 23, 2009

3.4 million ISF-10s

1,900 ISF Filers (90% customs brokers)

99,700 ISF importers on file

95% importers filing ISF

6,000 vessel stow plans

101 million container status messages

January 26 – September 21, 2010

6.2 million ISF-10s

2,350 Filers

194,000 ISF importers on file

97% importers filing ISF nationally

82% compliance in NY/NJ January 01, 2013 – December 31, 2013

10,508,000 ISF-10s / 2.1M since 1/1/14

2,500+ Filers (same# in 2014)

264,000 + ISF importers on file

90%+ importers filing ISF nationally

22,000+ vessel stow plans

369+ million container status messages


ISF Statistics and Updates

Bond Statistics (as of 3/18/14)

10,508,000 ISFs in 2013/2.1M in 2014

74,000 ISF-D Singles/Year (estimate)

99% of ISFs filed against CTBs

What about ebond?

Activity Code 1 (SEB and CB) by 1/3/15

Activity Code 16 ISF STB 3rd in volume

Yes, ISF Bonds in scope by 1/3/15

Enforcement Stats (as of 3/18/14)

10,000,000 ISFs since 7/9/13

1% result in Cargo Holds

.0003% result in LD claim

What about ACE Cargo Release?*

Ocean shipments effective 1/4/14

Deployment C is scheduled for 4/5/14

Will certify summary for release

* ACE Cargo Release “will not replace ISF, but it will allow the filer to fulfill the ISF requirements. The approach is that if we have the data in the system, the trade will not have to send it again. CBP cannot say when this will be operational…it may be after Deployment C or a separate deployment just for the ISF integration.”

http://www.cbp.gov/sites/default/files/documents/deploymentABC_infographic_2-27-14.pdf


Liquidated Damage Claims

• Volume as of 1/20/14

– # Received By CBP-HQ: Over 200 requested by ports

– # Approved By CBP-HQ: 24, only 20 issued by ports

• Types of Violations

– Non Files (these don’t really exist, all considered late files)

– Late Files (all ISF claims to date issued for this reason)

– Inaccurate/Incomplete (98% of ISFs accepted) • Missing Information; Duplicate ISFs; No CT on Flexible Filings

– B/L Mismatch • Inaccurate ISF, can also cause ISF to appear late


ISF Enforcement Updates

• ISF Enforcement Memo is being drafted to send to all Ocean Ports.

• Ports will be reminded that ISF enforcement should be focused on most severe violations during “measured” enforcement period.

• Severe violations will include failure to file an ISF and significantly late ISFs.


6-Year Statute

• ISF Liquidated Damage Claims

– Subject to 6-year statute per 28 USC § 2415(a).

– Before 7/9/13: CBP has no intention of issuing any LD claims prior to when ISF enforcement began, except in cases of fraud.

– After 7/9/13: CBP has up to 6 years to issue an LD claim for any ISF violations that occur on or after 7/9/13.

Some Welcome News from CBP… – Guidance to ports to issue LD claims within 6 months or so

of the ISF violation, otherwise understood no claim should be forthcoming.

– Does not absolve CBP of its rights to issue claims up to 6 years per statute.

– CBP is still reviewing running a query in ACE to know if an ISF is late on a real-time basis.

http://law.onecle.com/uscode/28/2415.html





ISF-10 Late/No Bond Option

• Yes, CBP still allows use of ISF Submission Type 5

• CBP FAQ pp 51-52, CSMS Message #11-000149, Quest 7/19/13

Activity Code ISF-D Single

ISF Submission Type 5 “ISF 10 Late – No Bond”

Potential issuance of LD for $5,000; mitigate 1st time violation $1,000-$2,000

“Admission of guilt or non-compliance,” only use for the “one-time” importer.

Cost of Bond Premium + Collateral/Fees ($1,100 to $5,500 range

depending on mitigating factors)

Cost of NIIs or full examinations plus storage and delay of cargo for inspections

($3,000 to $5,000 range)

CBP prefers an importer file an ISF for security purposes and be properly

bonded to meet ISF requirements during full enforcement period.

CBP-HQ has advised that abuse can result in penalties against the ISF Importer

under 19 U.S.C. 1595a(b) reserved for serious and repetitive violations.


http://apps.cbp.gov/csms/viewmssg.asp?Recid=18389&page=23&srch_argv=11-000149&srchtype=&btype=&sortby=date_published&sby=desc



http://www.avalonrisk.com/questnewsletter/special-quest/2013-07-09-ISF-Update/index.htm

http://www.gpo.gov/fdsys/pkg/USCODE-2010-title19/html/USCODE-2010-title19-chap4-subtitleIII-partV-sec1595a.htm


ISF Mitigation Guidelines

Violation Type Cause Max. 1st Violation All Other C-TPAT

ISF-10 Filing Late File $5,000 $1,000-$2,000 $2,500 50%

ISF-10 Filing Inaccurate Filing $5,000 $1,000-$2,000 $2,500 50%

ISF-10 Filing Inaccurate Update(s) $5,000 $1,000-$2,000 $2,500 50%

ISF-10 Filing Failure to Withdraw $5,000 $1,000-$2,000 $2,500 50%

Mitigating Factors • Maximum $10,000 per any one ISF transaction.

• ISF-5 for FROB cargo is not subject to liquidated damages at this time, but would be subject to same violation types and mitigating factors.

• 6 Mitigating Factors: 1) ISF progress since 1/26/09; 2) Small # of violations to shipments (%);

3) C-TPAT Importer Tier 2 or 3; 4) Demonstrated action to reduce future violations; 5) ISF filed late or Inaccurate, can mitigate if due to factors outside importer’s control (i.e. carrier’s fault).

• 4 Aggravating Factors: 1) Non-cooperative; 2) Multiple errors on the ISF; 3) Rising or Deteriorating Error Rate; 4) Smuggling/Fraud.




LD Claim Examples (Avalon data) Departure

Date ISF Filed Date/ Violation Date

# of Days Late

Date of Cargo Arrival in USA

ISF Report Card Info

Status

7/12/2013 7/17/2013 6 7/31/2013 Not Available Petition Granted

Reduced to $1,000

7/12/2013 7/24/2013 13 7/29/2013 Not Available Petition Pending

7/12/2013 7/29/2013 18 7/31/2013 Not Available Petition Granted Cancelled in Full

7/12/2013 7/30/2013 19 7/29/2013 Not Available Petition Pending

7/12/2013 7/18/2013 4 7/31/2013 40% ISFs Late

5/1/13-7/31/13 Petition Granted Reduced to $500

7/22/2013 7/24/2013 3 7/28/2013 Not Available Petition Granted Reduced to $500

• None of these claims had an NII or exam prior to issuing claim.

• Only one of the claims had an ISF hold and subsequent LD claim issued.

• An LD claim can be issued even if the ISF had no cargo hold

and/or NII and/or exam.


Mitigation Best Practices

• Importer’s ISF Performance Record – How long has importer been compliant with ISF?

– Emphasize importer’s compliance record

• Timeliness/Accuracy (95% timely/98% accurate)

• Include ISF Progress Report (from Filer or ACE portal)

• Overall cooperation

• C-TPAT Status – Request 50% mitigation based on C-TPAT status of importer

and/or ISF Filer.

• Describe Nature of Error or Violation – If clerical in nature, describe why it occurred?

– Is ISF Filer or Carrier at fault? Provide specific details.

– Was it a one-time or repeat violation? Explain.

– Outline how future violations will be avoided.


ACE ISF Portal • ISF Progress Reports

– CSMS #11-000155 effective 7/13/11 http://apps.cbp.gov/csms/viewmssg.asp?Recid=18395&page=9&srch_argv=11-000155&srchtype=&btype=abi&sortby=&sby=

– Importers and ISF Filers have access to ISF Report Cards in ACE • Previously only available through monthly email subscription

• Questions on ISF Progress Reports to [email protected]

– Reports also available to Importers, ISF Filers, and Sureties (limited data) • Data provided in varying formats, to surety only as a monthly data download

– Importers with 12 or fewer ISFs per year • Can file directly through ACE portal

• Importer would need continuous bond, ISF-D single not available in ACE portal

• Reports Generated Monthly (for prior month’s activity)

– Importers, ISF Filers and Sureties are all posted on different days

– If not posted by 10th of the month, contact ACE Help Desk

– C-TPAT 2/3 receive line item detail

http://apps.cbp.gov/csms/viewmssg.asp?Recid=18395&page=9&srch_argv=11-000155&srchtype=&btype=abi&sortby=&sby=



http://apps.cbp.gov/csms/viewmssg.asp?Recid=18395&page=9&srch_argv=11-000155&srchtype=&btype=abi&sortby=&sby



mailto:[email protected]


ACE ISF Portal • All ACE accounts access ISF reports in same manner

– Go to References Tab

– Select Task “Links” from Menu Panel on the left

– Button to “Launch ISF” will appear

• “Launch ISF” will open new window – Sign up for reports in Reports Menu

– Reports will then appear in Reports Tab (check daily) http://apps.cbp.gov/csms/docs/18395_749938721/Final_Information_Notice_ISF_Portal.pdf

http://apps.cbp.gov/csms/docs/18395_749938721/Final_Information_Notice_ISF_Portal.pdf

Per CBP, only an “estimate” of ISF compliance

ISF Progress Reports

Copyright © Avalon Risk Management - 2014


ISF Progress Reports • Timeliness measured based on local time of Departure Date

of the Mother vessel destined for the U.S. minus 24 hours.

• Uses the Vessel Departure Messages (VDMs) received by CBP from ocean carriers.

• “ISFs Not Measured for Timeliness” occur when no VDM was received. Per CBP, “these are not late ISFs and do not negatively affect an importer’s compliance rate, but also why the progress report is just a best estimate of compliance.”


ISF Surety Data in ACE • Surety receives snapshot of ISF activity (monthly) • Effective 3/10/14, surety now receiving VDMs

• ISF Transaction Count based on Avalon Data – Based on Avalon data via ACE portal since July 2011 and VDMs since March 2013

– Format/Filer: 80% ABI; 20% AMS (B/L match codes may vary)

– Action Reason: 98.28% Compliant Transaction vs. Flexible Filing (FR, FT, FX)

– Status 99.89% Accepted; .11% Rejected

– Bond Type: 98.37% CBs; 1.63% STBs

– Late ISFs: 16% of ISFs filed late (data not fully populated yet)

Bond

Holder

ISF

Imp #

ISF

Imp

Name

Filer#

Name VDM

ISF

Sent

Date

Formt Action Status Action

Reason

Shipment

Type

ISF

Status

ISF

# SCAC

Bill

#

Bill

Type

Bond

Type

Bond

Code Error

Bond

#

Name

09/10/13

01:38:10

PM

09/06/13

01:38:24

PM ABI Add Active CT 01 Accepted BM 9 16 STB#

IR#

09/08/13

2:10:28

PM

09/13/13

04:19:38

PM AMS Add Active CT 01 Accepted OB 8 1 CTB#


More Questions?

Avalon ISF Questions Gabriela Craver, AVP Surety at [email protected]

[email protected] ISF Line: 847-700-TISF (8473) ISF Claim Questions Zuleika Medina, Surety & Subrogation Claims Manager

[email protected] Direct line: 847-700-8074

Lisa Gelsomino [email protected] Direct line: 847-700-8192

ISF Information http://www.avalonrisk.com/isf.html

CBP Craig Clark [email protected] or 202-344-3052

CBP ISF Page http://www.cbp.gov/border-security/ports-entry/cargo-security/importer-security-filing-102

CBP ISF FAQs 7/9/2010 http://www.cbp.gov/sites/default/files/documents/10_2faq_0.pdf

ISF Liquidated Damage Mitigation Guidelines








http://www.avalonrisk.com/isf.html






















STB Centralization and eBond Updates from CBP

Kara Welty Chief, Debt Management Branch, Revenue Division

Office of Administration-CBP Indianapolis

http://www.cbp.gov/xp/cgov/trade/trade_programs/bonds/pilot_program/

eSTB Process Flow


eBond Surety Perspective

Lisa Gelsomino President/CEO

ITSA member, TSN eBond Sub-Committee, COAC Bond Working Group


eBond Trade Outreach

• 09/27/13: TSN Meetings/eBond Subcommittee Meeting

• 12/02/13: TSN eBond Committee Meeting (VA)

• 12/12/13: NEI eBond Webinar and Surety Visits

• 01/16/14: CBP and CSEC Meeting with Sureties

• 02/10/14: CBP Presentation to NBCBA

• 02/20/14: COAC meetings provide eBond updates

• 02/25/14: NCBFAA Software Vendor Meeting

• 03/20/14: CCBFA seminar/webinar on eBond

• 04/02/14: TSN eBond Committee Meeting (VA)

• 04/07/14: NCBFAA eBond Panel

• 05/22/14: COAC and CSEC Meetings (DC)


In Scope for eBond

• CBP 301 Bond Form Activity Code STB Continuous CTB Count

1 – Importer or Broker x x 174,731

1a – Drawback x x 1,049

2 – Custodian of Bonded Merchandise x 5,770

3 – International Carrier x x 5,911

3a – Instrument of International Traffic x 807

4 – Foreign Trade Zone Operator x 862

5–10 (Public Gauger, Wool/Fur, B/L, Detention, Court Costs) x N/A

11 – Airport Security x 510

16 – ISF x x 142

• Out of Scope: Activity Code 12 (ITC), 14 (IBEC), 15 (IPR) and 17 (MTO)

• eBond will capture over 99.9% of all Customs bond activity

http://forms.cbp.gov/pdf/CBP_Form_301.pdf


Bond Designation Type Codes

• N = Add a NEW basic bond

• A = An ADDITIONAL bond An additional bond; the bond that secures an AD/CVD, PGA or any

other aspect not covered by the basic bond requirement. Applies only

to a Single Transaction Bond (STB).

• V = VOID the STB on file

• R = REPLACE the bond amount of the STB on file

• S = SUBSTITUTE the bond presented at time of entry Substitute bond from 3461 entry to 7501 summary See 48 CFR 28.106-2 - SUBSTITUTION OF SURETY BONDS;

• C = SUPERSEDE the bond presented at time of entry See §142.4 Bond Requirements

• T = TERMINATE the Continuous Bond on file

http://www.law.cornell.edu/cfr/text/48/28.106-2?qt-cfr_tabs=0



http://www.ecfr.gov/cgi-bin/text-idx?SID=47006f709b97b1e3509df12bb55c66d1&node=19:2.0.1.1.2.1.1.5&rgn=div8





• Activity Code 1 (2-11 and 16 data elements TBD)

• Bond Type Code (8 for Continuous or 9 for STB)

• Bond Amount (Customs Directive 099 3510-004)

• CHB Reference Number (optional)

• Entry Type Code

• Entry Number & Filer Code

• Importer of Record#, Physical Address, Mailing (optional)

• Port Code (expect that this is subject to change)

• Principal’s Country Code (country of domicile)

• Surety Code and Filer Code

• Surety Producer Code (surety account# for billing)

Proposed eSTB Data Elements

http://www.cbp.gov/sites/default/files/documents/3510-004_3.pdf



http://www.cbp.gov/sites/default/files/documents/cspo_gif_979_v2_3.pdf


• Commodity/HTSUS (determines duty for bond amount)

• Country of Origin (identifies CBP targeted areas)

• Value/Duty/Taxes/Fees (determines bond amount)

• PGA Indicator/Agency Codes (determines bond amounts)

• Sureties approve “routine” shipments (99%)

• Target High Risk Cargo (estimate 1% of cargo) – AD/CVD high risk commodities/countries/trans-shipments

– Honey, Tobacco, other “fraud” targeted cargo

– FDA subject to redelivery problems

– Avoids E&O exposure for CHB when issuing bonds in violation of their U/W authority

Additional Data Elements (3461 vs. 7501)


• Total Value (3461)

• Total Estimated Duties (7501)

• Total Estimated Taxes (7501)

• Total Estimated Fees (7501)

• Bond Amount (7501)

• PGA Indicator (7501)

• Transmit from ABI

• STBs: (Customs Directive 099 3510-004)

• CTBs: Current Bond Formulas

Bond Amount/Sufficiency




http://www.cbp.gov/sites/default/files/documents/bond_form_7.pdf


• AD/CVD Case Number

• AD/CVD Case Deposit Rate & Rate Type Qualifier Code

• AD/CVD Value and Quantity

• AD/CVD Duty Amount

• AD/CVD Quantity

• AD/CVD Non-Reimbursement

• Declaration Identifier

• Bonded AD/CVD Duty Amount

• Cash Deposit AD/CVD Amount

• Bond/Cash Claim Code

AD/CVD Data Elements


• Unified Entry/ISF (Activity Code 1 Single or S1)

– ISF Transaction Number

– Vessel Departure Date (VDD)

• Activity Code 16 for ISF-D Singles (S16)

– Transmitted separately as it is today

– ABI Integration also possible

– Data elements TBD

ISF Bonds


Continuous Bonds (eBond)

• CBP will begin Agile planning May 2014 (05/07/14)

• 19CFR113 updated to eliminate paper requirement

– Sureties have “absolute” liability; no execution defenses

– Revise Letter of Application Requirements

– Will eBond accommodate eRiders and eTerms? Yes!

– Termination notice may change (from 10/30 to 15 days)

• Recordkeeping requirements (19CFR113.15) – Continuous Bond# will change from 9 to 10 digits

• New 5106 Impact? – Name/Address Change Riders – Bond Sufficiency Increases and “Bad” Addresses – Term/Replace

http://www.ecfr.gov/cgi-bin/text-idx?SID=e275bcbf29e642d9f1f77c7a91405792&node=19:1.0.1.1.17&rgn=div5

http://www.ecfr.gov/cgi-bin/text-idx?SID=e275bcbf29e642d9f1f77c7a91405792&node=19:1.0.1.1.17&rgn=div5

http://www.cbp.gov/sites/default/files/documents/bond_form_7.pdf


eBond ABI Integration

Celeste Catano Senior Global Strategist

TSN Ambassador and Industry Thought Leader


Communications with Sureties

• Working with Sureties to develop standard data elements for ABI vendors – ABI vendors can integrate with multiple sureties easier

– Trying to avoid having 10-15 different formats

• Data Formats – Tilde (~) separated file

– XML

• Communication Methods – MQ

– Web Services

– FTP or SFTP


Data Elements to Surety

• Shipment Level – Action Code (Add, Replace, Delete)

– Importer of Record Number

– Bond Principal Country

– Bond Producer Account Number

– AD/CVD Only indicator

– Anticipated Port Code

– Entry Filer/Number and Type

– Bond Amount

– Estimated Value

– Total Duty, Fees, AD/CVD and IR Tax

– Broker Reference

– Contact Method for exceptions – Name, email, Phone etc.

• Line Level – Tariff Numbers

– PGA Agency Codes

– AD/CVD Case numbers


Entry - Broker and Surety Process

Broker Keys Entry & STB

info

Request send Entry to CBP

Entry Data on Hold Pending STB accept

Has Surety

approved?

Send STB request to

Surety

Surety Response

Send Entry to CBP

Visibility into responses

(Emails/reports)

Yes – Auto

Send Entry Broker handles

exceptions

No

Note – Similar flow for ISF


Other - Broker and Surety Process

Manual Change

Send STB request to

Surety

Surety Response

Visibility into responses

(Emails/reports)

Additional Bond

Replacement Bond

Broker updates Shipments

Void Bond


Customs Broker Perspective

Tina Jansen Vice President, Compliance and Import Services

TSN Technical Advisor and TSN eBond Subcommittee


Customs Broker Perspective

• RLF entries available for STBs

• Dual bond environment from Jan to Nov. 2015

• Should we worry about processing delays

• Bond forms go away

• Process changes are coming – Cancellations, substitution, etc.

• Automation is critical and allows for additional visibility for sureties


Customs Brokers Preparation

• Understand what your software provider and surety are doing to automate

• Stay informed as new process develops

• Review underwriting guidelines – Does staff understand authority limits general/product types?

– If not may cause processing delays.

• Ensure staff is properly trained


Frequently Asked Questions CBP is currently working to develop

Here’s a list of the Top 10


eBond Timeline

Q1: When will eBond become mandatory?

A1: “For entries filed in ACE, once eSTB is up and running, it will be mandatory that the bond be submitted via eSTB automation tool. eSTB and eBond are part of Increment 5 which is scheduled for deployment 1/3/15. CBP recognizes that all entry types won't be submitted in ACE until 11/15.”

Note: If entries are processed in ACS after 1/3/15, there will be no paperless release and paper bond is still required until CBP mandates all entries in ACE by 11/15.


eBond Integration

Q2: Like the Affordable Care Act, it appears that ACE will need to interface with multiple vendors. Do we have enough time for testing built in? Do we know how many sureties we will be interfacing with?

Note: CBP has indicated there will be surety test pilots.

A2: “CBP will constantly monitor the timeline needed to successfully implement this change for all parties. CBP currently only interacts with 10-15 sureties/surety agents.”


eBond Integration

Q3: Unlike ACE there will be at least 2 layers of vendors involved?

A3: “The system configuration may vary for each surety. That will be determined outside of CBP’s scope.”

Note: Sureties plan to integrate with ABI vendors to automate the process, not hinder it. Each surety will need to continue providing support to issue bonds via ABI system integration or directly through the surety’s own software that will transmit to CBP no different than today.


eBond Integration

Q4: Although preferred, will the bond process have to be integrated into a broker’s ABI software or could a broker file the STB data to a surety via the sureties' own system. After getting a positive response from the Surety could the broker just send his regular entry data to ACE.

A4: “The bond will only be received from the surety’s system. The business relationship between the surety and the broker or importer is not CBP’s business. The broker will still submit the entry data through the normal ABI process.”


eBond Integration

Note: Each surety maintains their own software and will need to continue issuing paper bonds for non-ACE entries until CBP requires all entries to be processed in ACE.

Options: 1) Customs broker issues eBond via ABI and transmits data to surety for approval. 2) Customs broker uses surety’s system to issue bond and surety transmit s data to CBP. 3) Customs broker prints bond as they do today until Nov. 2015 when all entries must be in ACE.


Bond Amount/Sufficiency

Q5: Will there be an ACE Validation to make sure the bond amount is sufficient? The user can re- submit the Cargo Release/Entry Summary Data with a new value which would cause the original bond amount to not be sufficient and would need to be adjusted.

A5: “Sufficiency is not within the scope of the automation tool at this time. However, CBP personnel will still have the ability to review sufficiency. If the bond amount needs to be adjusted then a Replacement Bond should be submitted.”


Bond Cancellations/Changes

Q6: Will there be a process to cancel an STB posted at release in error or to post an STB to an entry summary released on a continuous bond after release? A6: “Although it is the policy of CBP to not cancel or give back bonds, CBP understands that there will be very limited circumstances where a bond has been given in error. Each bond will be determined on a case-by-case basis.”


Bond Cancellation/Changes

• Replacement Bonds (Activity Code 1 Singles Only)

– STBs only, not continuous bonds

– Only allowed in 10 day window between Entry (3461) and Entry Summary (7501).

– Only the Bond Amount field can be changed.

– All other fields must remain same as originally transmitted.

– Replacement Bond assumes liability for the entire transaction starting with 3461 filing.

• Example – At time of entry, bond amount = $10,000

– At summary, bond amount = $30,000



• Substitution Bonds (Activity Code 1 Singles Only)

– Assume liability for transaction when Substitute Bond filed.

– Original bond maintains liability for the timeframe prior to the Substitution Bond being filed.

– Substitution Bonds must be filed in the window between Entry/Release (3461) and Entry Summary (7501).

• Single Transaction Bonds – Substitution STBs will be treated as new Bond in ACE.

– No restrictions to match details between old/new bond.

– Both bonds logged to a single transaction for liability.

– Surety on original bond notified of change.



• Continuous Bond Substitution – Only if filer substitutes one continuous bond for another.

– May file Entry Summary with a different importer#.

– eBond validation to check if CB on file for new importer#.

– Superseding Bond Indicator would already be present in the Entry Summary set to appropriate value.

– Allows for Entry Summary to be filed with new bond successfully, as long as all other bond validations passed.

– By logging the Bond change to the transaction, Office of Administration will be able to determine the party liable for the transaction.



• Superseding Bonds (Activity Code 1 Only)

– Assume liability for increased and additional duties after the merchandise is released from CBP custody or the entry has liquidated.

– The initial bond used to secure release of the merchandise remains liable until the Superseding Bond is effective.

– Can be filed between Entry and 90 days after Entry Filing.

– Require the filing of a 3347 (Owner Declaration).

– 3347 submission requirements will need to be monitored by the Office of Administration.

– see §142.4 Bond Requirements







• Superseding STBs (Activity Code 1 Only)

– Treated as a new bond submission in ACE

– No restrictions to match details between old/new bond.

– Both bonds logged to a single transaction for liability.

– Surety on original bond notified of change.

• Superseding Continuous Bonds (Activity Code 1 Only)

– Required filing of 3347 (Owner Declaration)

– Results in change to the IOR# on the Entry/Entry Summary

– When IOR# is changed on Entry/Entry Summary (by ABI or by CBP), ACE will validate active CB on file for new IOR#.


Entry Questions

Q7: If your entry goes Docs Required, will CBP know there is or isn’t an STB done if it’s not printed?

A7: “The entry will indicate whether there is an eSTB in the system. The CBP personnel reviewing the file will be able to look in ACE to verify. The entry will not pass the edits if the bond hasn't been received.”


Entry Questions

Q8: Will the broker have to submit any documentation regarding STB with the entry package?

A8: “No”

Note: With eBond, the entire entry process will be paperless just as it is with a continuous bond. The underwriting process should not change from what customs brokers or importers are accustomed to, especially if ABI vendors can transmit data electronically and/or via surety portals.


eSTB Process Flow

Q9: Why can’t CBP send an ABI message to the filer simultaneously with the message to surety accepting the bond, rather than adding in a step requiring the surety to intermediate for that purpose? Why should it be done this way?

A9: “After much review, CBP has determined that all direct bond communication will be with the Sureties; as such, the EDI messaging regarding Bond intake and storage in ACE will be between CBP and the Surety…”


ISF Bonds

Q10: If the importer doesn’t have a Continuous Bond on file, will an eBond be an option for the ISF coverage on ocean shipments?

A10: “They will be able to submit a unified filing for the entry and ISF.”

Note: eBond will accommodate both Unified Entry/ISF (Activity Code 1 Single) or a separate ISF D Single (Activity Code 16). A unified Entry/ISF or ACE Cargo Release can only be filed if the Entry/Release and 10+2 elements are transmitted 24 hours prior to vessel departure (updates allowed up to cargo arrival in USA).


More eBond Questions?

Avalon Lisa Gelsomino

TSN eBond Subcommittee and COAC Bond Working Group [email protected] or 847-700-8192

eBond/IT Questions

Nathan Baylor, Vice President - IT & Surety [email protected] or 847-700-8143

eBond Information

http://www.avalonrisk.com/ebond.html

CBP

CBP eBond ACE Page

http://www.cbp.gov/trade/ace/catair






http://www.cbp.gov/trade/ace/catair


Contact Details

Lisa Gelsomino, President/CEO, Avalon Risk Mgmt/TSN

[email protected] or 847-700-8192 or 847-514-7100 (C)

M. Craig Clark, CBP Headquarters, Washington DC (OFO)

[email protected] or 202-344-3052

Kara Welty, CBP Revenue Division, Indianapolis IN (OA)


Tina Jansen, VP Compliance & Import Services, MIQ/TSN

[email protected] or 773-824-2264 or 773-203-5831 (C)

Celeste Catano, Senior Global Strategist, Kewill/TSN









Thank you for your time today! You will receive 2 CCS credits for your participation! For more information, please visit these web pages:

www.cbp.gov, ISF http://www.avalonrisk.com/isf.html, eBond at http://www.avalonrisk.com/ebond.html

http://www.cbp.gov/




Documents

ISF and eBond Updates from CBP - Avalon Risk Management CCBFA Presentation_March... · ISF and eBond Updates from CBP ... •ISF Enforcement Memo is being drafted to send to all Ocean