Questions Swirl on $800 de Minimis Validation in ACE as First Stage Deploys Smoothly

On CBP’s July 30 post-deployment call on its recently launched first stage of its $800 de minimis limit validation in ACE -- the requirement that Type 86 filings include an estimated date of arrival starting July 25 -- trade community concerns centered on the second stage, when CBP in September will begin rejecting shipments for exceeding the limit.

Foremost of those concerns were how CBP will decide which shipments to reject, and how filers should handle rejections.

On the latter point, a CBP official said it depends on the mode of transportation. Those responsible for Type 86 shipments arriving via ocean and air would have the option to change the entry type -- to Type 11, for example -- should their shipment be rejected because the consignee reached the $800/day threshold. That’s because the line for de minimis clearance is separate from the manifest for ocean and air, so the manifest itself would continue to be valid.

However, the situation is different for trucks because de minimis filings are incorporated into the truck manifest. If an import filing doesn't clear, neither does the manifest, leaving that individual shipment unmanifested and unable to cross the border, the official said.

The manifest filer would receive a message about the rejection and, if the truck isn’t yet en route, the shipment could either be held off the truck or an entry could be filed before the truck is en route. However, if the truck is en route, “that shipment’s not going to come off before the port of entry,” especially given how some trucks are loaded, the CBP official said.

The potential disruption that could cause has CBP “really trying to focus on making sure” the rejection happens “before the conveyance is headed to the United States,” the official said. That’s why the agency has been “so adamant” about using the estimated date of arrival to calculate the $800 per person/per day limit, so the cargo is "not at a port of entry or at a bonded facility,” he said.

As for how CBP will decide which shipments to reject if a consignee exceeds the $800 limit, the CBP official said all of them, with an important caveat.

Once a consignee goes over the $800 limit, then all of the shipments with that consignee on that day are ineligible for de minimis, the official said. And, assuming that the shipments are all unarrived, CBP will issue rejections for all de minimis shipments with an estimated date of arrival of the date that the consignee went over $800.

But if any of the shipments have already arrived at the port, the situation gets more complicated due to CBP operational concerns, the official said. “We have to operationally review our workload,” he said, and while CBP has the option to file a CBP Form 4647 Redelivery Notice for the first, arrived shipment, “most people won’t see a drastic change in our issuances of 4647s to recall shipments. However, the subsequent, unarrived shipments would be rejected.

Asked whether the entry type would have to change for the arrived filer, the official said, “I don't want to make a statement that this would always happen, but the reality is, at this time, I don't think we're going to require a change, even though our interpretation is it's not eligible for de minimis.” CBP needs “to get through the first development in this process of enforcing them all, and maybe down the line, we will make subsequent enforcement decisions in order to comply more fully with the law.”

CBP will be enforcing the limit based on name and address data elements, the official said. While that could result in failures to enforce the limit where a consignee puts two different addresses -- such as home and work -- or overenforcement if two people have the same name and live at the same addresses, he said that “there’s no perfect way to do it,” and CBP’s monitoring of de minimis data over the past few years doesn’t indicate that these will become real problems.

The official said CBP is “working on some FAQs and some other types of documentation” to answer recurring questions that the agency has heard. As for how the July 25 deployment of the Type 86 estimated date of arrival went, another CBP official said that, after an initial wave of rejects, the situation has "significantly calmed down" and rejects are few and far between.