CBP Lays Out Permissible Work for Unlicensed Customs Consultants

A U.S. customs broker license isn't necessary to create a tariff classification database, file ruling requests and protests, prepare import manuals or conduct post-entry audit reviews in many cases, CBP said in a Jan. 26 ruling (here). Neville Peterson lawyer John Peterson filed the ruling request on behalf of a Canadian customs consultancy that is working with a multinational chemical company on providing resources related to imports into the U.S. CBP agreed to keep confidential the identifying information of the companies involved in the ruling.

The Canadian company said it was asked to create a classification database for "a client’s products regardless of whether the particular product is ever actually imported into" in the U.S. The database, which would be used by customs brokers to help with import entries, would include a disclaimer that "the specific tariff classification to be applied to a specific entry of merchandise is to be determined by the licensed Customhouse broker or other agent engaged to file the entry," the company said. The database is permissible as long as it won't direct the client or broker in the preparation of the entries and has a disclaimer to that effect, CBP said. "The disclaimer will also note that to the extent the broker or agent disagrees with the suggested classification, 'the opinion of the broker or agent should be followed,'" the agency said. The consultancy can also provide U.S. customs compliance manuals with legal and regulatory requirements for importers, it said.

The consultancy also asked whether it could help clients with "post-entry audits and compliance reviews." That "work would only be done after entries are liquidated," with post-liquidation audit reports "communicated to Customs in the form of a prior disclosure," the company said. That question is a bit more complicated and more details would be necessary to know for certain, CBP said. The company's description of the work is "sufficiently vague that a definitive ruling is not possible," CBP said. "To be clear, Post-Entry Amendments and Post-Summary Corrections are considered 'customs business' and must be performed by a licensed customs broker," CBP said. But, as long as the work mentioned doesn't lead to the preparation or filing of customs documents, no broker license is needed, the agency said.

The Canadian company is also largely allowed to file ruling requests and protests, CBP said. Except for "NAFTA advance rulings requests," any "authorized agent of the importer of record may file ruling requests and protest," CBP said. Prior disclosure filings by the consultancy are also allowed, CBP said. "By statutory definition, prior disclosures are not 'customs business'" and the agency allows any involved party to file "a prior disclosure on behalf of a client if given proper authorization by that client to do so," it said.

CBP declined to rule on whether a company's reliance on the Canadian company's advice constitutes "reasonable care." Meeting that standard is "extremely fact-specific and is analyzed by Customs on a case-by-case basis," the agency said. As a result, CBP is "unable to prospectively rule" on whether the consultancy's "services in the abstract would 'enhance a client’s case' with regard to proving the exercise of 'reasonable care' if the client were to come into" a penalties situation, it said.