Trade Community Uncertain as CBP Set to Deploy $800 de Minimis Validation in ACE

CBP plans to enforce the $800 daily aggregated limit for de minimis shipments as a new functionality of the ACE platform.

But that action, whose second stage is set to occur on Sept. 29 and is meant to “automate the enforcement of the Section 321 requirements,” according to CBP (see 2407220050), is raising a lot of questions within the trade community about how smoothly that implementation will happen. Key among them are unanswered questions about enforcement, especially when it comes to calculating whether a shipment exceeds the $800 threshold based on an often difficult to estimate date of arrival, customs brokers told International Trade Today.

“I do believe it’s going to be disruptive,” consultant Cindy Allen said. Allen is CEO and managing director of Trade Force Multiplier. “I think it’s going to disrupt specifically shipments on the northern and southern border where the truck carrier files a manifest and that manifest is requesting de minimis release.”

It's unclear what actions CBP might take if a shipment has exceeded the $800 threshold but it’s also already at the border. Furthermore, the estimated date of arrival may also be different from the actual arrival of a shipment, especially for ocean or air shipments, and there is some uncertainty within the trade about which date CBP will use for validating the de minimis threshold. The date is important so that the importer can comply with the $800 per day limit.

“Will the shipment be rejected because it's over $800 based on the estimated date of arrival, even though those goods on the ocean container haven't even arrived yet? We’re concerned about how CBP is going to view that” and what the downstream consequences might stem from that decision, Allen said.

Prior to the anticipated deployments in ACE, CBP has had no automated procedures to determine whether goods at the time of shipment exceeded the $800 per person, per day rule, according to Allen.

“There are a couple of things that are going to happen” once CBP enforces the threshold, said Amy Magnus, director of customs affairs and compliance at customs brokerage A.N. Deringer. Either an entry will have to be filled out by a broker, or the shipment is going to have to be returned to wherever it came from.

It's “creating a little bit of consternation” because “in an ideal world, Customs will make its decisions, and the data will all be filed prior to even the loading of the container or the truck. But in the real world, often that doesn't happen. Often, the container or the truck are loaded at the very, very last minute, and part of the reason for that is nobody knows exactly how much cargo is going to fit in a given container or on a given truck,” Magnus continued. “So there's your problem. So, the thing is loaded, and sometimes it's even on the way and now the data is transmitted to CBP and suddenly there are rejects.”

If this situation happens, a broker may need additional information to fill out a de minimis entry. However, that additional information might not be on a carrier’s manifest, Magnus said.

If that information isn’t immediately available, there’s uncertainty about what will happen to the cargo.

Said Allen: “If that gets rejected, we don’t know how CBP is going to react. Are they going to turn the whole truck around? Are they going to make the carrier refile the manifest? Are they going to require the carrier to remove that one shipment off of the entire truck? Or are they going to let the truck proceed to a container freight station and be held in bond until another type of entry can be filed? We don't know CBP’s approach or process yet.”

One suggestion to help the trade as CBP implements de minimis into the ACE system is to have an informed compliance period wherein CBP wouldn’t stop the goods but would still send messages so that stakeholders are aware of who is impacted and what is the volume.

“Customs brokers and importers can determine what processes will need to change and how we can and should be reacting to this information,” Allen said. It wouldn't be just waiving penalties or liquidated damages, but rather giving the information in an informed compliance manner so that the trade can react and respond, she said.

At the end of the day, the implementation of the de minimis threshold into the ACE system raises stakeholders’ long-standing question of how the trade can get more insight into CBP’s processes and decision-making.

“Right now, importers, brokers and carriers don’t necessarily have visibility into how many shipments are exceeding $800. No one has that full visibility. Only Customs does,” Allen said. “So we are concerned that it’s going to have a major impact and there hasn’t been a period of informed compliance for the entire trade to be able to work with CBP to resolve these issues.

“Yes, this has been a law for well over a hundred years, but this is the first time that information has been made available to those outside of CBP,” Allen said.

“This is a law that should be enforced. People should not be allowed to exceed the $800 per day rule, because that is a law … . But Customs, up until now, I don’t think had the proper tools to do the enforcement. This is their attempt now, so I guess we’re just going to have to see how it plays out,” Magnus said.

The first stage of the inclusion of the new estimated date of arrival data field will start at 5 a.m. EDT July 25 for Entry Type 86 shipments, according to a CSMS message.