NCBFAA Considering Alternatives to Licensed Broker Employment Ratio

The National Customs Brokers & Forwarders Association of America is now considering alternative ways CBP can support the continued presence of a sufficient number of licensed brokers in customs business, with the agency so far unreceptive to the NCBFAA’s broker employment ratio proposal, said Alan Klestadt of Grunfeld Desiderio in an interview on Oct. 9. Among the options under consideration is a possible policy statement from CBP that the agency would consider the number of licensed brokers employed when making decisions on penalty mitigation, said Klestadt, who is the NCBFAA's customs counsel.

There is some feeling at the NCBFAA that, while there is “no chance on a hard and fast rule” on a broker ratio, a policy statement has a chance for success, said a licensed customs broker familiar with the effort. Such a policy statement would include the number of licensed employees among the criteria CBP considers when considering mitigation of broker penalties related to lack responsible supervision and control, said the broker. The policy would not appear in the regulations, but would “stand as policy and go into the mitigation issue,” he said.

The NCBFAA previously asked CBP to adopt a regulatory requirement that customs brokerages operating on national permits keep one licensed customs broker on staff for every 12 employees engaged in customs business (see 14072222). The employment ratio proposal arose amid concerns that, as Remote Location Filing becomes available for all entry types, customs brokerages using national permits would only need to have one qualifying broker on staff for their entire brokerage operation, providing inadequate “responsible supervision and control.” The CBP Advisory Committee on Commercial Operations issued a similar recommendation in May 2014 (see 14052209).

Though initially receptive to a licensed broker ratio (see 1504220017), CBP has since backed away from including it in revamped Part 111 regulations (see 1510050015). Agency leadership cited concerns that the CBP would be intervening in the customs brokerage market, and that the regulations would be difficult to justify to the Office of Management and Budget. As such, the NCBFAA is discussing alternative means to “try to reinforce the concept that there should be licensed individuals involved in a meaningful way for customs brokerage transactions,” said Klestadt. CBP did not immediately comment.