AMS Proposal on Paper Products Order Would Make Brokers Liable for Assessments, NCBFAA Says

The National Customs Brokers & Forwarders Association of America is calling the Agricultural Marketing Service's proposed changes to the definition of importer for the purposes of a promotion order on paper products “unprecedented" in its breadth and ramifications for customs brokers, according to comments filed with the agency.

The association warned AMS the proposed revised definition would make customs brokers liable for importer assessments under the promotion order.

The letter, dated Aug. 14 and signed by NCBFAA President J.D. Gonzalez, said that the NCBFAA disagrees with AMS’ proposed revised definition of importer in Section 1222.8 for purposes of identifying the party responsible for paying the Paper Checkoff assessment on imported paper products. AMS proposed the changes to its Paper and Paper-Based Packaging Promotion, Research and Information Order in a July 15 Federal Register notice (see 2407120046), and the NCBFAA’s letter is in response to the call for public comments on the proposal.

“AMS’ definition is unprecedented. Of the 40+ agencies that regulate imports, not one holds the customs broker responsible for fees or taxes imposed on imported products. While we may facilitate and transmit the payment of duties and fees by the Importer of Record, customs brokers are not the party liable for the payment,” Gonzalez said in the letter addressed to AMS Associate Administrator Erin Morris.

“It is essential that AMS recognize and respect this distinction between the importer and the filer: as filers, we are responsible for the accurate transmittal of the data and the exercise of due diligence; our client, the importer, is responsible for the accuracy of the data on the declarations that they provide to us and is liable for any duties, taxes and fees associated with that product,” Gonzalez continued.

The revised definition says that “Importation occurs when paper and paper-based packaging manufactured outside of the United States is released from custody by Customs and introduced into the stream of commerce in the United States. Included are persons who hold title to foreign-manufactured paper and paper-based packaging immediately upon release by Customs, as well as any persons who act on behalf of others, as agents or brokers, to secure the release of paper and paper-based packaging from Customs when such paper and paper-based packaging is entered or withdrawn for use in the United States.”

AMS instead should consider keeping the current definition, which places the responsibility of paying importer assessments with the importer of record, as defined by customs law, the NCBFAA argued.

“AMS seeks to broaden the scope of the definition to include an array of potential parties, including intermediaries, such as customs brokers, who are merely facilitating the shipment and filing the Customs entry. We recognize that the proposed definition is patterned after an existing regulatory definition in 7 CFR Section 1222.101(f). Nevertheless, the definition is ill-suited for this purpose,” Gonzalez said.

He continued: “This proposed definition does nothing to clarify who is responsible for payment of the assessment on any given shipment. In fact, it blurs the roles and responsibilities of the parties and injects confusion into the process.”

Gonzalez concluded the letter by saying that NCBFAA is willing to work with AMS on any perceived shortcomings with the current definition.

AMS was taking comments on the proposed changes through Aug. 14.