CBP, NCBFAA Set to Kick Off Broker Known Importer Program

ORLANDO, Fla. -- CBP and the National Customs Brokers & Forwarders Association of America are set to launch the Broker Known Importer Program (BKIP) in the coming week, said agency and trade association leadership at the NCBFAA annual conference on Aug. 22. With functionality in the Automated Commercial Environment in place since January, CBP will issue a CSMS message next week detailing the voluntary program, which will lower the agency’s risk profile for an importer if their broker informs CBP through a flag checked at entry that it “knows” the importer and has advised the importer of its compliance responsibilities. The CSMS message will allow BKIP to “go live,” said Mary Jo Muoio of OHL Trade Services.

The NCBFAA has put together a nine-page questionnaire (here) that brokers can go over with their importers in order to begin using the program, including questions on bonds, the right to make entry, classification, valuation, free trade agreements, antidumping and countervailing duties, binding rulings, and intellectual property rights. However, the use of the questionnaire is not required for participation in BKIP, as long as the method of establishing a known importer is documented, said Muoio. Regardless of the method used, brokers must maintain records showing the depth of the broker-importer relationship and periodically review their known importers, according to an implementation guide (here) released by NCBFAA in anticipation of BKIP’s launch.

CBP has indicated that the agency will give importers flagged as known importers improved “targeting segmentation,” said Alan Klestadt of Grunfeld Desiderio and NCBFAA’s customs lawyer. Whether that means fewer exams is unknown, but the agency will be getting positive information about the importer, he said. Once BKIP is underway, CBP will begin an analysis of the program’s value with respect to improved risk assessment, said Muoio. The agency will take a look at broker and importer participants and the commodities they import in order to decide the agency’s strategy going forward, said Kevin McCann, acting director of commercial targeting and analysis at CBP’s Office of International Trade.

BKIP is set to be a “win-win-win” for all involved, said Darrell Sekin of DJS International Services, under whose NCBFAA presidency the program was first announced in 2013 (see 13041124). The program will deepen brokers’ relationships with their importers, improve the accuracy of their entries, and could even “lead to the discovery of additional business opportunities for the broker,” says NCBFAA’s implementation guide. For CBP, BKIP will be yet another way to differentiate risk between importers, and will prove especially useful for importers that don’t take part in trusted trader programs like the Customs-Trade Partnership Against Terrorism (C-TPAT) and Importer Security Assessment (ISA), said McCann.

Some raised concerns over the new program during the NCBFAA conference panel. One attendee asked whether CBP’s analysis of the program will result in more audits for participating importers, to which McCann replied that the agency already has enough data to see how well the program is working and audits will not be necessary. Another asked whether the lack of a BKIP flag on an entry might be viewed as a negative by CBP. Muoio answered that the presence of a flag would be viewed as a positive, but no flag would be viewed as neutral and not a reason to examine the cargo.

Several customs lawyers attending the conference worried that BKIP might impose new liability on customs brokers. George Tuttle worried that the broker could be subject to penalties for false statements if an importer brings in counterfeit goods after having marked on the initial questionnaire that the importer doesn’t enter trademarked goods. Su Kohn Ross of Mitchell Silberberg said importers should have to sign off on the questionnaire responses to protect the broker from liability. However, according to CBP’s McCann, the agency is “not contemplating penalties as a result of the use or misuse” of BKIP.

Other attendees were more enthusiastic about the program. “I see an opportunity here,” said one. “When I go back to my port of entry and I start marketing this, I hope the other brokers don’t, because it’s going to give me an advantage.”