CBP Interim Rule Lays Out Formal Plans for ACE Adoption, ACS Phase-Out

CBP spelled out its plans for shutting down the Automated Commercial System and requiring the Automated Commercial Environment for electronic filing in an interim final rule (here), as expected (see 1509300020). The interim rule explains that ACE will be an authorized Electronic Data Interchange system as of Nov. 1 and that CBP will phase out ACS as an authorized EDI. CBP will also end pilot programs and adjust its regulations as part of the change to ACE, it said. Comments are due Nov. 12.

Due to the success of pilots for ACE Cargo Release and Entry Summary, Accounts and Revenue, CBP is amending its regulations to say ACE is an authorized EDI, said CBP. Those tests will end "only with regard to requirements directly related to automated entry and entry summary that do not involve data from other [International Trade Data System] agencies upon the effective date of this rule," it said. Reconciliation entries are not affected by the change, said CBP.

CBP will update its regulations to replace most mentions of ACS with the phrase "ACE or any other CBP-authorized electronic data interchange system,” it said. CBP will keep a mention of ACS within regulations for Merchandise Processing Fees because "because that system will continue to be used to process payments, including MPF," said CBP. CBP will add the phrase or any other CBP-authorized electronic data interchange system” within the MPF regulations "to enable CBP to transition the payment processing functions to ACE at a later date," it said. The rule will also redefine several terms to indicate electronic filing through ACE is allowed, it said.

CBP doesn't need to remove references to the Automated Broker Interface because ABI continues to be the functionality that allows entry filers to transmit immediate delivery, entry and entry summary data to CBP, and to receive transmissions from CBP," the agency said. CBP will update its regulatory definition for ABI, though, to say it is separate from ACS, CBP said.

Filers should move quickly to make necessary changes to use ACE, said CBP. "In consideration of the business process changes that may be necessary to achieve full compliance and to provide members of the trade community with sufficient time to transition from ACS to ACE, filers are encouraged to adjust their business practices at the current time so that they can file in ACE before the end of February of 2016 when it is anticipated that ACS will no longer be supported for entry and entry summary." CBP recently said Nov. 1 would mark a new "informed compliance period" after CBP decided to push back some of the mandatory use dates for ACE in response to readiness concerns for the system (see 1509010017).

Elimination of Hybrid Filing

CBP also requested comments on a proposal to eliminate the ability for filers to submit information through a combination of paper and electronic filings. "When importers file a paper or hybrid entry, they fill out the required documents on their computer, print the documents, and then send the documents to their broker or to the port of entry by either mail or a courier," said CBP. "CBP is considering proposing a rule to require importers to choose between submitting the required entry and entry summary documentation (including ITDS Agency documents) entirely electronically or entirely by paper." CBP previously said it hopes to issue a final rule eliminating hybrid filing in July (see 1509020015).

CBP expects the cost of making software changes to add compatibility with ACE "will fall on the software developers and the 5 percent of importers who do not purchase a software product, because they develop their own software," the agency said. "It can cost from $25,000 to $90,000 to make the change to ACE formatting, including systems costs and training" and CBP expects "that it will cost our estimated 112 software vendors and 38 self-filers between $3.75 million and $13.5 million to file in ACE format."

(Federal Register 10/13/15)