Details of CBP Proposed Rule to Change In-Bond Regs (Part III- IT, T&E, Etc.)

This is Part III of a multi-part series of summaries on this proposed rule. Part III covers proposed revisions to the in-bond regulations in 19 CFR Part 18 Subparts B through H, which contain requirements for Immediate Transportation, Transportation and Exportation, pipeline transportation, Importer Security Filings, etc.

(Note that CBP is not proposing to change the in-bond procedures found in the air commerce regulations at this time, except to change certain time periods to conform to the proposed changes in this rule. Accordingly, proposed 19 CFR Part 18 would cover the requirements and procedures pertaining to the transportation of merchandise in-bond, except as provided in Parts 122 (air commerce regulations) and 123 (CBP relations with Canada and Mexico).)

Proposed 19 CFR 18 Subpart B (Immediate Transportation)

General Rules for Immediate Transportation Shipments

Proposed section 18.11 would provide the following general rules for Immediate Transportation (IT) shipments without appraisement:

• Delivery outside port limits. Merchandise covered by an entry for IT would be allowed to be delivered to a place outside a port of entry for examination and release with the approval of CBP. Carriers or other responsible parties would have to request, via a CBP-approved electronic data interchange (EDI) system, permission to transport the merchandise in-bond. The importer would have to stipulate in the in-bond application that within 24 hours after arrival of any part of the merchandise to a place outside the port of entry, the importer will file an entry for the shipment and comply with other IT provisions.

• Split shipments. One or more entire packages of merchandise covered by an invoice from a consignor to a consignee would be allowed to be entered for consumption or warehouse at the port of first arrival. The remainder would be allowed to be entered for IT, provided that all of the merchandise covered by the invoice is entered and any carnet which may cover such merchandise is discharged as to that merchandise.

• Consolidated loads & combined shipments. Several importations would be allowed to be consolidated into one IT entry when bills of lading or carrier's certificates name only one consignee at the port of first arrival. Merchandise moving under cover of a carnet would not be allowed to be consolidated with other merchandise.

Procedures for Merchandise Under IT Entries at the Port of Destination

Proposed section 18.12 would provide the entry procedures at the port of destination. Merchandise received under an IT entry at the port of destination would be allowed to be entered for transportation and exportation (T&E), immediate exportation (IE), IT, or under a FTZ admission, or any other form of entry, and would be subject to all the conditions pertaining to merchandise entered at a port of first arrival.

When a portion of a shipment is entered at the port of first arrival and the remainder of the shipment is entered for consumption or warehouse at one or more subsequent ports, the entry at each subsequent port could be made on an extract of the invoice. All merchandise included in a transportation appraisement entry (including carnets) would have to be entered within 15 calendar days from the date of arrival at the port of destination.

Proposed 19 CFR 18 Subpart C (Shipment of Baggage In-Bond)

Baggage Could Be Forwarded In-Bond to Another Port Without Exam or Duties

Proposed section 18.13 would provide that baggage may be forwarded in-bond to another port of entry, or to certain Customs stations without examination or assessment of duty at the port or station of first arrival, at the request of the passenger, the transportation company, or the agent of either, by filing an in-bond application. Baggage arriving in-bond or otherwise at a port on the Atlantic or Pacific coast, destined to a port on the opposite coast, could be laden under CBP supervision, without examination and without being placed in-bond, on a vessel proceeding to the opposite coast, provided the vessel will proceed to the opposite coast without stopping at any other port on the first coast.

Baggage from Foreign Country Would No Longer Need to Be Tagged

Proposed section 18.14 would provide that the baggage of any person in transit through the U.S. from one foreign country to another may be shipped over a bonded route for exportation. The requirement that the baggage be tagged under both sections 18.13 and 18.14 would be deleted.

Proposed 19 CFR 18 Subpart D (Transport & Export)

General Requirements for T&E Entries, Export within 15 Days

Proposed section 18.20 regarding the general requirements for transportation and exportation entries would require the filing of the in-bond entry and require the reporting of the arrival of merchandise at the port of export within 24 hours of arrival. This section would also exempt merchandise entered for T&E from Electronic Export Information (EEI) filing requirements, provided that the merchandise has not been entered for consumption or warehousing. If the merchandise requires an export license, it would be subject to the filing requirements of the licensing federal agency.

This proposed section would also require that in-bond merchandise be exported within 15 calendar days from the date of arrival at the port of export and that the bonded carrier update the in-bond record within 24 hours of exportation to reflect the exportation and to specify that the port director may require evidence of exportation.

(The proposed rule would delete and reserve section 18.21 regarding restricted and prohibited merchandise because these requirements would be encompassed in proposed 18.1(l). See Part II of this series for summary.)

Procedures for Transfer and Express Shipments at Port of Exportation

Proposed section 18.22 would provide the procedures for transfers and express shipments at the port of exportation and apply them to all modes of transportation. It would also provide the procedures for an express company bonded as a common carrier to transfer baggage by express shipment from its terminal to the exporting conveyance for lading under CBP supervision, without a permit from the port director and without the use of a transfer ticket or other CBP formality.

Rules for Notifying CBP of Change in Port of Foreign Destination

Proposed section 18.23 would require the carrier or other responsible party to notify CBP of a change of foreign destination that was provided in the original in-bond application by updating the in-bond record via a CBP-approved EDI system within 24 hours of learning of the change. Merchandise received at the anticipated port of export could be entered for consumption, warehouse, FTZ or any other form of entry, and would be subject to all the conditions pertaining to merchandise entered at a port of first arrival.

Requirements for Retaining Goods within Port Limits

Proposed section 18.24 would provide that upon application via a CBP-approved EDI system by the carrier or other responsible parties, the port director has discretion to allow in-transit merchandise to remain within the port limits (and not just on a dock) under CBP supervision without extra expense to the Government for 90 days, provided that the owner of the premises where the merchandise is located has consented. The carrier or other responsible party would then have to submit an immediate exportation in-bond application.

Additional extensions of 90 days or less could be granted by the port director upon request, but the merchandise would not be allowed to remain in the port limits for more than 1 year from the date of arrival of the importing conveyance at the port of first arrival. Any merchandise that remains in the port limits without authorization would be subject to general order requirements.

Procedures for Splitting Shipments for Export

Proposed section 18.24 would also permit the splitting up of a shipment for exportation when (i) exportation in its entirety is not possible because different portions of the shipment have different destinations, (ii) the exporting vessel cannot properly accommodate the entire quantity, or (iii) similar circumstances. The carrier or other responsible party would have to submit a new in-bond application for each portion of the original shipment to be transported in a manner inconsistent with the original in-bond application. All movements of the split shipment would have to be initiated within two days from the date that the first portion of the split shipment is authorized or it would be considered an irregular delivery. The splitting up of a shipment of merchandise being transported under cover of a carnet would not be permitted.

Proposed 19 CFR 18 Subpart E (Immediate Export)

Requirements for Direct Exportations

Proposed section 18.25 would provide the following requirements for direct exportations:

• Merchandise requiring application. Except for certain exportations by mail, an in-bond application would have to be transmitted for the following merchandise when it is to be directly exported without transportation to another port: (i) merchandise in CBP custody for which no entry has been made or completed; (ii) merchandise covered by an unliquidated consumption entry; or (iii) merchandise that has been entered in good faith but is found to be prohibited under U.S. law.

• Truck shipments. Shipments arriving at a U.S. port by truck, for which an immediate exportation entry is presented as the sole means of entry, would be denied a permit to proceed. The port director would have discretion to require the truck to return to the country from which it came or allow the filing of a new entry.

• 15 days to export. Any portion of an in-bond shipment entered for immediate exportation pursuant to an in-bond entry would have to be exported within 15 calendar days from the date of arrival to the port of export, unless an extension has been granted by CBP. On the 16th day, the merchandise would become subject to general order requirements.

• Electronic Export Information. Filing of Electronic Export Information (EEI) would not be required for merchandise entered under an Immediate Exportation entry provided that the merchandise has not been entered for consumption or for warehousing. If the merchandise requires an export license, it would be subject to the filing requirements of the licensing Federal agency.

• Export without landing. If the merchandise is exported in the arriving carrier without landing, a representative of the exporting carrier would have to certify that the merchandise entered for exportation was not discharged during the carrier’s stay in port. A charge would be made against the continuous bond on CBP Form 301 if on file. If not on file, a single entry bond would be required, as in the case of residue cargo for foreign ports.

• Notice & proof of export. The bonded carrier would have to promptly, but no more than 24 hours after exportation, update the in-bond record via a CBP approved EDI system to reflect that the merchandise was exported. The principal on any bond filed to guarantee exportation could be required by the port director to provide evidence of exportation within 30 days of exportation.

• Explosives could be entered. Gunpowder and other explosive substances, the deposit of which in any public store or bonded warehouse is prohibited by law, could be entered on arrival from a foreign port for immediate exportation in-bond by sea, but would have to be transferred directly from the importing to the exporting vessel.

Similar Requirements Would Be Provided for Indirect Exportation

Proposed section 18.26 would provide the procedures for indirect exportations. For indirect exportation, merchandise to be exported in the importing carrier without landing (freight remaining on board) could be transported in-bond to another port for exportation and entered for transportation and exportation upon the transmission of an in-bond application to CBP, via a CBP-approved EDI system. Upon acceptance of the entry by CBP and acceptance of the merchandise by the bonded carrier, the bonded carrier would assume liability for the transportation and exportation of the merchandise. If the merchandise was prohibited entry by any Government agency, that fact would have to be noted in the application.

Other requirements under this section for carnets, time to export, and notice and proof of exportation are similar to the above proposed requirements for direct exportations under section 18.25. See proposed rule for full details.

Original Port Marks Would Have to Appear in All Documentation for Export

Proposed section 18.7 would provide that port marks may be added by authority of the port director and under the supervision of a CBP officer. The original marks and the port marks would have to appear in all documentation pertaining to the exportation.

Proposed 19 CFR 18 Subpart F (Pipelines)

Proposed section 18.31 would provide the requirements for transportation of bonded merchandise via pipeline. This section is similar to current regulations regarding pipeline transportation of bonded merchandise, however, it would be amended to provide that the in-bond application will be made by submitting a CBP Form 7512. It would also be amended to remove the requirement that the document of receipt be submitted with the in-bond document and to instead require that the document of receipt be submitted with the in-bond application.

(This proposed rule would not make any changes to Subpart G on merchandise not otherwise subject to customs control exported under cover of a TIR carnet, which covers sections 18.41-45.)

Proposed 19 CFR 18 Subpart H (Importer Security Filing)

Proposed section 18.46 would cover Importer Security Filing (ISF) information. For merchandise transported in bond, which at the time of transmission of the ISF is intended to be entered as an immediate exportation (IE) or transportation and exportation (T&E) shipment, permission from the port director of the port of origin would be needed to change the in-bond entry into a consumption entry. Such permission would only be granted upon receipt by CBP of a complete ISF.

See future issue of ITT for final detailed summary of this proposed rule.

(Note that CBP authorities have stated that most of the proposed rule's requirements have already been built in ACE.

See ITT's Online Archives 12022218 for Part I of this series, which provides an overview of the major amendments proposed to the in-bond regulations. See ITT's Online Archives 12022317 for Part II of this series, which covers proposed revisions to the general requirements of the in-bond regulations in 19 CFR Part 18 Subpart A. See ITT's Online Archives 12022131 for initial summary announcing the availability of this proposed rule.)

CBP Contact -- Gary Schreffler (202) 344-1535

(Docket Number USCBP-2012-0002, FR Pub 02/22/12)