NEW IMPORTANT ISF UPDATE

On Tuesday, January 26th, the Importer Security Filing will go from a delayed enforcement to a GRADUATED ENFORCEMENT.

US Customs & Border Protection (CBP) on Friday, January 22nd, advised the trade of its strategy for a graduated enforcement which will BE in 3 month quarter phases. The base of the graduated enforcement will be the data CBP receives beginning January 26, 2010.

The FIRST quarter phase beginning on January 26th.

CBP advised they will not be issuing liquidated damages during the first quarter (until April or May 2010). Instead, CBP will be issuing warning letters. However, Customs reserves the right to employ full enforcement measures for fraud, smuggling, or terrorism connected with the shipment or repetitive violations of the ISF requirements

1.) ON FILING - CBP will monitor ISF filings for importers that are filing and those that are not.
*For an importer that is NOT filing its Importer Security Filings, CBP will send a letter stating that the importer has not filed and are required to file. The lack of filing by importers will result in liquidated damages and other delays in the release of the importer's cargo.

*For Importers that ARE filing and are having trouble filing, CBP will work with you to resolve issues during the first quarter.

2.) ON COMPLETENESS AND ACCURACY - CBP advised they will be issuing warning letters to importers regarding completeness, errors or discrepancies and will work with them in bringing their imports into compliance.

3.) ON TIMELINESS OF THE ISF- In monitoring the timeliness of ISFs, CBP advised they will be targeting those that are filing up to a week late rather than those that are an hour or a day late during the first enforcement phase in. CBP will be working and advising the trade through informed compliance letters.

In the SECOND and THIRD quarters of 2010

CBP advised they will ramp up enforcement on all the requirements. Importers, who are not filing, have serious errors or discrepancies, and late filings can anticipate delays and examinations in their ocean imports. If CBP sees repeated incidents of no ISFs being filed and there is no response from the filer, CBP may issue a claim for liquidated damages.

CBP also indicated liquidated damages (penalties) for ISF violations will also be ramped up during the third and fourth quarters. CUSTOMS RESERVES THE RIGHT TO EMPLOY FULL ENFORCEMENT MEASURES for fraud, smuggling, or terrorism connected with the shipment or repetitive violations of the ISF requirements. CBP further advised the liquidated damages will be initiated at the port level and sent to Headquarters for further review in order to ensure ISF liquidated damages assessments are handled in a uniform manner.

PLEASE NOTE THESE GUIDELINES ARE NOT BEING PUBLISHED IN WRITING AT THIS TIME AND ARE CONSIDERED INTERNAL GUIDELINES FOR CBP WHICH HAVE BEEN VERBALLY SHARED WITH THE TRADE.

The Final Rule on ISF has not been published. CBP advised a Final Rule will be published in the Federal Register over the next 30 days.

As we enter the first quarter ENFORCEMENT phase, John S. Connor will continue to assist and work with our customers in continuing to report the 10 required data elements as being complete and accurate, as well as achieving a 100% timely filing of 24 hours prior to cargo laden on board a vessel at the foreign port of export. We urge all importers to take the necessary steps to ensure their supply chain processes are appropriately moditied to maintain compliance with the ISF requirements.