Licensed Customs Broker

PALM SPRINGS, Calif. -- Upcoming changes to Canadian border processes will be a “game changer” for the clearance process, Kim Campbell of Mkmarin Trade Services said on Oct. 20. The Canada Border Services Agency (CBSA) Assessment and Revenue Management (CARM) is set to be implemented by the end of 2020, allowing e-commerce customers to fill out their own customs declarations and eliminating the entry process for commercial importers, she said, speaking at the Western Cargo Conference. Other initiatives will allow truck cargo to cross the border without stopping, through the use of radio frequency ID tags and facial recognition software, she said.

Changes to de minimis is the most significant change from NAFTA in customs administration and trade facilitation under the rewritten agreement, practitioners say, but exactly how that will work in practice is still unknown. Shipments from the U.S. or Canada into Mexico will not face duties if they are valued at less than $117, and will not have to pay tax if they are valued at less than $50. Shipments into Canada from NAFTA partner countries will be tax-free if valued under 40 Canadian dollars, and duty-free at under 150 Canadian. (Mexico's $117 limit matches C$150 at current exchange rates.)

The customs chapter for the new U.S.-Mexico-Canada Agreement, or revised NAFTA, includes some provisions aimed at customs brokers. Those provisions, included in Article 7.21, stipulate that self-filing must be permitted and that customs broker licensing requirements must be transparent. Also, "no Party shall impose arbitrary limits to the number of ports or locations that a customs broker may operate," it says. "A Party shall allow a licensed customs broker to electronically submit a customs declaration and import documentation to the electronic systems" at "any port at which it is licensed to operate."

Customs brokers this week will be lobbying congressional leaders to press the Department of the Treasury and CBP to change the proposed rule that excludes excise taxes from drawback, and will be asking members to co-sponsor the Customs Business Fairness Act (see 1712180053). The act, H.R. 4657, would change bankruptcy law so that customs brokers are not subject to clawback on duties advanced to CBP after a client declares bankruptcy.

ATLANTA -- A “proof of concept” set to begin in September will provide for brainstorming and early-stage testing on the use of blockchain technology in processes related to NAFTA and the Central America Free Trade Agreement (CAFTA), Vincent Annunziato, director of CBP’s Business Transformation and Innovation Division, told a group of reporters at the CBP 2018 Trade Symposium on Aug. 14. CBP will consider not only the technical capabilities of blockchain and any business benefits but also whether use of the technology fits with the agency’s regulatory and policy scheme.

RANCHO MIRAGE, Calif. -- Customs brokers are mostly happy in dealing with the Centers of Excellence and Expertise, panelists said during a May 2 discussion at that National Customs Brokers & Forwarders Association of America's annual conference. Maureen Oliphant, regional compliance manager at Yusen Logistics, said she is seeing far fewer Requests for Information (CBP Form 28). There have even been occasions that someone from a Center called Oliphant to ask for other information rather than sending out a CF 28, she said. CBP "is a lot easier to deal with" since the Centers were added, Oliphant said.

CBP will expand its definition of "importer" under Importer Security Filing (ISF) regulations, the agency said in a notice. Despite some concerns raised by the National Customs Brokers & Forwarders Association of America and the World Shipping Council (see 1609120024), the final rule adopts the definition changes as proposed in 2016 (see 1607050028). The rule will take effect on May 14.

Several drawback filers and importers on March 23 filed a court challenge of CBP’s new policies on drawback procedures under the Trade Facilitation and Trade Enforcement Act. They say CBP violated the Administrative Procedure Act when it changed drawback requirements via a guidance document issued in February without allowing for notice and comment on what amount to regulatory changes.

A freight forwarder breached its fiduciary responsibility to pay customs duties and refund overpayments, even though it is not a broker licensed to perform customs business, the Northern Illinois U.S. District Court said in a decision issued Dec. 20. Pactrans did not have a fiduciary duty as a customs broker to Union Pacific to pay $5.8 million in antidumping and countervailing duties, but the power of attorney allowing Pactrans to act as Union Pacific’s agent mentioned duty payment, and the forwarder breached that fiduciary duty as an agent when it kept the money for itself, the court said.

Customs brokers will be able to file their 2018 triennial reports and pay their broker license fees beginning on Dec. 15, CBP said in a CSMS message. The fees and reports, which must be filed by Feb. 28, may be submitted online via the website Pay.gov. The $100 fee may be paid by credit card, debit card, PayPal or Amazon Pay, with no additional transaction fees. Though the fees may also be paid in person or by mail at the port that originally delivered the license, CBP is actively encouraging brokers to use the electronic payment option, which allows brokers to “save time and submit online,” said Troy Riley, executive director for commercial targeting and enforcement at CBP, at a recent agency conference.