Canadian Importer and Exporter Association Concerned About Residue Test Requirements

The Canadian Association of Importers and Exporters (I.E. Canada) voiced some concerns for the requirement to make entry for residue as part of CBP's planned pilot program. CBP is in the process of developing a pilot program that would test new requirements for filing entries on residue contained within Instruments of International Traffic (IIT). I.E. Canada filed the comments with CBP ahead of a planned Federal Register notice detailing the pilot.

CBP recently released a draft Federal Register notice regarding the pilot program and sought industry comments on the proposed test. CBP will be considering the comments on the draft in January ahead of publication in the Federal Register, said a CBP spokesman. The draft notice is (here).

(In July 2009, CBP published HQ H026715 in the Customs Bulletin, to require chemical residue imported in reusable containers be classified, entered, and manifested, while the containers themselves continue to be considered IIT. That ruling said "to ensure the safety and security of the transportation of such containers and the CBP officers who may examine or work in close proximity to them, CBP believes that these containers should not be entered as empty, nor should they be manifested as empty." There's been concern and uncertainty over how the requirement would be enforced. Enforcement on the issue had been scheduled to begin Dec. 28, but that date was rescinded as the agency worked on the pilot notice.)

Safety and Security Already Addressed

I.E. Canada took issue with CBP's safety and security concerns with IITs. Filing entry on containers with reside won't provide additional protection and the Transportation Department's hazardous materials shipping requirements in Canada and the U.S. already communicates the risks involved for containers with hazardous materials.

CBP should also take into account filers who don't have the ability to file electronic manifests or advance electronic cargo information, said I.E. Canada. Such filers won't be able to participate in the residue pilot under the draft notice. "If the test is only open to “parties who have the ability to file electronic manifests or advance electronic cargo information” how can importers, exporters, and their service providers be assured their best interests are taken into account," asked the association. "In the event their carriers choose not to participate in the 'test', these groups need to be able to directly participate in the 'test' to help shape the procedures that directly affect their businesses."

There's also a question of the regulations that would apply to parties that don't participate in the test. The draft says such parties "will have to manifest and enter the residual cargo under current regulations and procedures." Clarification is needed as to what the “current regulations and procedures” are and how they apply to non-test participants during the course of the test, the association said. "Importers and exporters cannot develop sound and compliant operating practices that align with 'test participants' procedures or assist CBP in evaluating the 'test' procedures without knowing what is expected of them.

Should Test for Manifesting Necessity

CBP could also change the pilot to test residue manifesting without making entry, said I.E. Canada. Such a test would leverage "the Automated Commercial Environment advance cargo reporting efficiencies to realistically evaluate cargo security and officer safety risks and/or the absolute necessity to make entry on residual cargo," the group said. "If after evaluation of such a modified manifest only “test”, the results clearly indicate a requirement for residue to be entered, then this aspect can then be added and evaluated." The agency should also clarify the definition of No Commercial Value (NCV) and what constitutes valid proof of NCV, it said.

The American Association of Importer and Exporters and National Customs Brokers and Forwarders Association didn't release their comments on the draft notice.

(Email ITTNews@warren-news.com for a copy of the I.E. Canada's comments.)