CBP Issues New Instructions for Filers Affected by Hurricane, Expecting Long-Term Impact to Texas Ports

CBP on Aug. 29 issued additional guidance on cargo affected by port closures from Hurricane Harvey. For now, nothing needs to be done for entries and entry summaries that have already been filed, even for cargo diverted to other ports. Pending entry summaries for entries already filed at affected ports should be filed at the same port, while pending entries should be filed at the new port of arrival, CBP said. In the long-term, the trade community should expect the Port of Houston and other affected ports to be closed for the “foreseeable future” and plan their shipments accordingly, said Gary Schreffler, acting chief of CBP’s Cargo Control & Release Branch, during a call held Aug. 29.

For the moment, CBP has “no idea what the infrastructure is like” at ports closed by Harvey’s unprecedented flooding, which currently include Houston Seaport and Airport, Port Arthur, Galveston and Freeport. “We’re as in the dark right now as you are,” Schreffler said. Customs houses in Houston and other affected ports are currently unstaffed, with CBP employees reporting in by phone. “I think we’ve accounted for everybody. We suspect that some people have had losses on a personal level,” he said.

CBP is focused on keeping cargo moving. Guidance issued yesterday directed carriers with ships underway to Houston and other affected ports to amend their manifests to reflect new ports of unlading. The agency has learned from its experience with Hurricane Sandy, where cargo was held up by port authorities and terminal operators because they couldn’t see updated ports of arrival, Schreffler said. CBP is not asking filers to updates entries because it is “trying to keep the impact on the trade as minimal as possible,” he said.

For the medium- and long-term, members of the trade community needs to adapt their processes to account for the potential for lengthy closures, Schreffler said. “I would not count on being able to send cargo” to affected ports in the “next month or so,” he said. The ports “could dry up miraculously in the next week but that’s not what I’m seeing in the news at all.” The agency’s recently issued diversion policies are only meant for ships that were underway when the ports were closed, he said. A shipment leaving Germany today should be destined from the outset for other ports, he said.

CBP is currently working on additional guidance for the trade community on procedures that may be affected by Harvey. “We’re basically blowing the dust off previous guidance” issued in response to past disasters, including Hurricanes Katrina and Sandy. “No sense in reinventing the wheel.” On deck are instructions for cargo that is in Houston right now that may have been damaged, as well as guidance on how it will handle statements and reconciliation entries affected by the port closures, Schreffler said. The agency will also likely relax permitting procedures to allow brokers permitted only in Houston to file at other ports.

CBP has determined not to issue liquidated damages for Importer Security Filings listing Houston and other affected ports as the ports of arrival, and changes to ISF fillings likely won’t be necessary, Schreffler said. CBP will also likely not be issuing penalties for general order merchandise sitting in Houston and other affected ports, he said. The Food and Drug Administration has agreed that changes to prior notices are not necessary.

“One-off” scenarios are expected, and CBP will continue to work with the trade community to address them. “We’re going to be responsive,” Schreffler said. “As trouble tickets or ‘Ask ACE’ emails come in, we’re not going to ignore them,” he said. CBP is “pretty dedicated to make sure cargo continues to flow” despite any dislocations caused by the port closures. In the meantime, CBP will continue to monitor Harvey as it moves along the Gulf Coast and “comes back ashore” for potential impacts on other ports, including the Port of New Orleans, he said.