CBP Planning to Add Reconciliation, Possibly Drawback, to CEEs, Though Lengthy Processes Expected

NEW YORK- CBP is planning to eventually add reconciliation processing from the ports of entry to the Centers of Excellence and Expertise (CEEs), said Dora Murphy, director of the Apparel, Footwear and Textiles CEE on Nov. 6. The agency is also feeling out a move of drawback processing to the CEEs, though that idea is still in the early stages of discussion at the agency, she said at a conference held by the U.S. Fashion Industry Association, previously known as the U.S. Association of Importers of Textiles and Apparel (see 13110612). CBP will also relax the Importer Self-Assessment (ISA) requirement for CEE participation early next year in an effort to add members, she said.

Adding reconciliation to the CEEs will require an update to two Federal Register notices, one revising regulations for reconciliation and another for the CEEs, she said. Updating reconciliation rules will be an especially big undertaking because the reconciliation process will likely see a "real major overhaul to make it a lot simpler for the trade," she said. "This is something we are actively working on right now at CBP headquarters."

Possible changes to drawback processing are at the very beginning of consideration, said Murphy. "There are a lot of very political views on what to do with drawback since the advent of the CEEs," she said. There's already been a lot of feedback from the trade industry and "this issue is very much on the table," she said.

CBP will open the last of the three branches that make up the CEEs -- the validation and compliance branch -- once the program is opened up for wider participation, Murphy said. The other branches, partnership and enforcement, are already up and running, she said. The CEEs will open the validation and compliance branches once CBP drops its ISA requirement, expected for January, she said. The non-ISA members will be handled with the validation and compliance branches, said Murphy. The agency plans on adding the remaining ISA members by the end of 2013, she said. The agency previously said is was looking into making the CEEs available to non-ISA members (see 13041522).

Apparel and textile duties continue to make up a huge amount of the revenue collected by CBP, said Murphy. Those duties make up close to 48% of the total duties collected by the agency, largely because the duty rates for such products are generally much higher than others, she said. The average duty rate for apparel and textiles is 17%, while the next highest, by industry, is 2%, she said. Murphy also discussed the integration of CBP's Laboratories and Scientific Services group within CEEs processing, which was recently outlined at a Footwear Distributors and Retailers of America conference (see 13102427).