CBP Will Seek to Spread Liability Beyond IORs, Redesign Entry Process in 21st Century Framework

CBP has identified three primary goals for the 21st Century Customs Framework, which has the potential to upend the approach to customs processing, said Maranda Kan, acting director of trade modernization, Office of Trade. Those goals are: “to achieve end-to-end supply chain transparency; to drive data-centric decision-making; and to diversify reasonable care standards,” she told a virtual U.S. Fashion Industry Association event Nov. 10.

As part of the reasonable care effort, CBP plans to “better define the roles and responsibilities of new and emerging actors by diversifying their responsibilities and to include additional parties,” she said. Currently, “virtually all liability lies with the importer of record,” but by “properly attributing liability, then the risk is more effectively mitigated through the trade community” and allows CBP to more quickly identify bad actors, she said. Such a change is “provocative,” said moderator Mary Jo Muoio, senior vice president-trade services and government relations at Geodis USA. It remains to be seen whether importers like the idea of spreading the liability or see it as a loss of control, Muoio said.

Supply chain transparency is important due to increased complexity and “transparency is really going to be essential for ensuring safety, security and speed during entry,” she said. Also, consumer demand trends show more interest in “sustainable and socially conscious” goods, Kan said. CBP is working on an “entry modernization initiative” to address those issues by “fully redesigning our entry process to align with the natural flow of information that comes in through supply chains.”

CBP will also redefine its entry data information requirements as a way to increase its use of data in decision-making, Kan said. This will help reduce “redundant data transmissions” and, along with the supply chain transparency, will help industry provide information earlier to allow CBP to make decisions faster, she said.

CBP's ruling in July that addressed the treatment of unsold low-value goods sent to fulfillment centers (see 2007310036) is hoped to add some clarity around the use of the de minimis exemption, said John Leonard, CBP executive director-trade policy and programs. “If we can get visibility as to who that individual is, even if it's still a foreign seller who's simply using the U.S. fulfillment warehouses as a way to sell their goods, that will determine for us who is eligible for de minimis, and if we find people abusing that privilege, obviously we can force them to file informal or formal entries and pay duty,” he said. There's been an “informed compliance type of posture” and CBP is “working with the main express consignment carriers to help them better enforce this ruling with their clients and their customers,” he said.

Asked about recent uptick in cargo exams noticed by customs brokers, Dennis McKenzie, CBP deputy executive director, cargo conveyance and security, Office of Field Operations, said the change has been in exam thoroughness and not quantity. Due to the lack of travel at the moment, CBP officers who used to clear passengers are now doing “some of the exams we couldn't normally focus on,” he said. While the exams are more comprehensive, CBP remains intent on keeping legal trade flowing, he said.