Importer Security Filing and Additional Carrier Requirements

10+2 Trade Outreach Webinar

Spring 2010
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Todays Presentation on 10+2

Overview of the ISF Requirements

Program Update
Enforcement Strategy

Top ISF Issues

Q & A Session
Los Angeles - Long Beach Seaport

What is the Security Filing?

The Security Filing, commonly known as the 10+2 initiative, is a Customs and Border Protection (CBP) regulation that requires importers and vessel operating carriers to provide additional advance trade data to for non-bulk cargo shipments arriving into the United States by vessel. Importer Requirements:
U.S. Bound Cargo: requires the electronic filing of an Importer Security Filing (ISF) comprised of 10 data elements (a.k.a., ISF-10). Transit Cargo: requires the electronic filing of an ISF comprised of 5 data elements (a.k.a., ISF-5).

Carrier Requirements:
Vessel Stow Plans required for arriving vessels with containers.
Container Status Messages required for containers arriving via vessel.

Importer Security Filing (ISF) Importer

The party required to submit the Importer Security Filing (ISF) is the party causing the goods to enter the limits of a port in the United States. This party is known as the ISF Importer.
Could be the owner, purchaser, consignee, or agent (e.g. customs broker).

The ISF Importer, as a business decision, may designate an authorized agent to file the Importer Security Filing on the ISF Importers behalf.
If an agent is used for ISF purposes, a power of attorney (POA) is required.

The ISF Importer is ultimately responsible for the timely, accurate and complete submission of the ISF filing.

ISF-10 Data Elements

U.S.-bound Cargo (3461 Entries, IT, FTZ)
1. 2. 3. 4. 5. 6. 7. 8. Importer of Record Number Consignee Number Seller (Owner) name/address Buyer (Owner) name/address Ship to Party Manufacturer (Supplier) name/address Country of Origin Commodity HTS-6

9. Container Stuffing Location 10. Consolidator (Stuffer) name/address 11. Bill of Lading Number (house or reg.) 12. ISF Importer

CBP Form 3461

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From Order to Delivery

Overseas Factory/Warehouse Shipper/Carrier Distribution Center

Consolidator (Stuffer) Container Stuffing Location

Ship To Party

Vendor/Supplier Container Stuffing Location Manufacturer (Supplier) Consolidator (Stuffer) ISF Importer Seller (Owner)

Importer/Retailer

Invoice Purchase Order

Manufacturer (Supplier) Seller (Owner) ISF Importer Ship To Party

The ISF-10 is due 24 hours prior to vessel lading

ISF Importer
Importer of Record # Consignee # Buyer (Owner) Ship To Party 6

ISF Filing Requirements

All ISF filings are to be done electronically via the vessel Automated Manifest System (AMS) or the Automated Broker Interface (ABI)
ISFs cannot be done at the Port of Entry (i.e., Custom House) on a walk-in basis

There is no paper form

(e.g., 3461)
Bonds are required to cover

most ISF transactions

ISF Filing Options

CBP has begun development of an internet-based web portal to accept ISF filings
Importers must pre-register their importer ID numbers with CBP (i.e., IRS# or SSN#) Registration of the importer ID number can be done in person at a local Port of Entry or by a licensed customs broker via the use of CBP Form 5106 Portal will be available no earlier than August 2010 Use of the portal will probably be limited to no more than two (2) ISF filings per day, with a maximum of twelve (12) per year

In addition, some service providers allow self-filers indirect access to CBP systems via the internet Contact a CBP Client Representative at 571-468-5500 to discuss self-filing options

10+2 Interim Final Rule

Effective Date: The interim final rule (IFR) took effect on January 26, 2009 (60 days after the publication date) and allowed for certain flexibilities:
Timing of transmission for 2 of the 10 ISF data elements Range of responses for 4 of the 10 ISF data elements

All other requirements in this rule were adopted as a final rule.

Compliance (Enforcement) Date: January 26, 2010

The IFR flexibilities will stay in effect until the structured review is completed and a decision on keeping, modifying or removing them is made by DHS, OMB and other executive branch agencies.

Structured Review and Flexible Filing

CBP monitors all ISF submissions for timeliness, accuracy and completeness. On the basis of information obtained during the structured review and public comments, DHS will undertake an analysis of the elements subject to flexibilities. Analyze Flexible Range of Responses (FR) Elements
Ship to Party Manufacturer (Supplier) name/address Country of Origin Commodity HTS-6

Only 2% of all filings claim to use the flexible filing option

Analyze Flexible Timing (FT) Elements

Container Stuffing Location Consolidator (Stuffer) name/address

If you choose to use a flexible option, you MUST amend your filing with a CT
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ISF Data Improves Targeting Capabilities

40 Container

Source
BILL OF LADING

Description
SHEET

HTS
N/A

C/O
N/A

Role
Shipper Consignee

Party
XYZ LOGISTICS ABC TRUCKING

Non IntrusiveNEW Inspection (NII) X-Ray Image Only SECURITY FILING DATA
BED LINEN

NII Image Manifest Data 630210 and CN MFR/Supl. XINJIANG TOP BEDDING PRODUCTS
Seller Buyer Importer Consignee

Stuffing Location XINJIANG, CN Consolidator XYZ LOGISTICS Ship To Name/Add. THE TRANSFER WHSE (L.B., CA)

Whats in the box?

XINJIANG TOP BEDDING PRODUCTS BE & D IMPORT INC (PHX., AZ) BE & D IMPORT INC (PHX., AZ) BE & D IMPORT INC (PHX., AZ)

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ISF Data Improves Cargo Identification

Bullet Casings HTS 9306.30

Bomb Casings

Gear Casings

Motor Casings

What Are Casings?

Computer Casings Sausage Casings Tire Casings Pipe Casings

HTS 1601.00

HTS 7304.20 12

10+2 Program Update

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ISF-10s By the Numbers

January 26, 2010 May 2, 2010 Total Submissions: 2,453,200

Total Rejected:
Total Accepted:

80,293
2,372,907 Adds: 79%

3%
97%
Note: Do NOT send in a REPLACE to simply force an ISFBill match message!

Replaces:
Deletes: Filers: Importers (IOR #s): 2,226 123,000+

19%
<1%

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Top Five Error Messages

ISF-10 Errors from January 26, 2010 April 25, 2010
60,000 52,259 50,000

40,000

30,000 19,791 20,000 17,502 13,231 9,010 10,000

0 Duplicate ISF Invalid ISF Transaction # Invalid Country Code Invalid HTS # Invalid ID Code

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ISF Progress Reports

In production since May 10, 2009 Registration is Required

Reports are on a Monthly Cycle

Reports Cover 122,251 ISF Importers We Offer .pdf, .csv, and .xls Formats

Four Types Currently in Production:

Importer by Filer Reports (most common) - Over 1,105 ISF Filers are registered Filer Summary Report C-TPAT Importer Reports (Tier 3, 2) C-TPAT Importer Transactional Reports (Tier 3)

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Importer Security Filing (ISF) Progress Reports

1. ISF10 Submission Volume:

C-TPAT Benefits of 10+2

Customs - Trade Partnership Against Terrorism

Earlier Decision Making

C-TPAT entities are reliably identified prior to vessel lading
Based on Importer of Record Number on the ISF No longer tied solely to entry data (24 hours or more prior to arrival)

Better Decision Making

Tangible C-TPAT benefits are applied much further upstream
Receive targeting credit based upon their tier status

Stabilization of Automated Hold Process

Immediate Transportation (IT) in-bond risk assessments are more stable

Validation of Supply Chain Security Reviews

New Entities and Locations Identified and/or Verified
Container Stuffing Location Consolidator (Stuffer) name/address

10+2 Enforcement Strategy

CBPs Vessel Stow Plan Module Used to identify unmanifested containers

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ISF Enforcement Strategy

The full compliance (enforcement) date for the 10+2 requirements commenced on January 26, 2010, thus ending a 12-month delayed enforcement period in which CBP provided extensive outreach to educate the trade community on the new requirements. CBP will: Apply a measured, commonsense approach to enforcement Exercise the least amount of force necessary to obtain full compliance Evaluate non-compliance on a case-by-case basis Continue to provide outreach and guidance to the trade

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Enforcement Measures
Informed Compliance Efforts
Public outreach (incl. webinars, meetings, ISF Progress Reports) Informal and formal notification (e.g., warning letters)

Mid-level Compliance Measures

Domestic NII examination manifest holds Domestic physical examinations Re-evaluation and possible reduction of C-TPAT status

Strictest Enforcement Measures

ISF Jail (i.e., lengthier manifest holds) Liquidated Damages Suspension or Revocation of C-TPAT Status Do Not Load or Do Not Discharge Orders

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10+2 Challenges

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Top ISF Issues Identified

How does CBP measure ISF Timeliness?
The regulation states 24 hours prior to lading (Legal) CBP will measure by the Vessel Departure Date minus 24 hours (Practical)

Which bill of lading number do I use?

Must use the lowest bill of lading transmitted in AMS (house or regular) Contact your shipper

New ABI query functionality will help

CBP allows for the bill of lading number to be updated on the ISF

I cant get a bond because I missed the filing deadline

CBP is considering creating a Type 13 Late ISF coded transaction Importers are acknowledging that they violated the regulations Will probably not be available for longer than one (1) year
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Top ISF Issues Identified

I didnt receive the ISF Bill on File match message.
This is common; especially when the ISF filing precedes the filing of the customs manifest (i.e., bill info).

Make sure you (or your agent) annotated the correct bill type on the ISF.
Regular Bill This bill type is also referred to as an Ocean" or Simple Bill and is issued by a Carrier. There are no underlying house bills. House Bill Typically issued by a NVOCC (sometimes referred to as an automated freight forwarder). A house bill of lading always falls under a carriers Master bill of lading.

ISFs cannot be filed against Master Bills Do NOT Send in a REPLACE to force an ISF-Bill Match message

Do I need to file 24 Hours prior to lading of the feeder or mother vessel?

The ISF is due 24 hours prior to lading of the mother vessel
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Available Resources
Go to: www.cbp.gov
Copy of the Interim Final Rule

ISF PowerPoint Presentation

General Frequently Asked Questions (FAQs) Document Copy of the Regulatory Assessment Implementation Guides (Technical File Formats) Mitigation Guidelines News Releases Outreach Schedule

Security_Filing_General@cbp.dhs.gov
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Questions?
www.cbp.gov

Security_Filing_General@cbp.dhs.gov
10+2 Contacts
Richard Di Nucci, Director, Cargo Control Division John Jurgutis, Branch Chief, ISF & Vessel Manifest Stephen Silvestri, Branch Chief, Air & Rail Manifest Craig Clark, Program Manager, ISF Joseph Martella, Program Manager, New York Field Office

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