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CBP Releases Long-Awaited Part 111 Broker Modernization Final Rule

CBP on Oct. 17 released its long-awaited final rule amending Part 111 to modernize the customs broker regulations. As expected, the final rule eliminates broker district permits, modifies CBP’s responsible supervision and control framework for brokers, and increases fees for the broker license application to better cover CBP’s costs. CBP also released a concurrent final rule eliminating all references in its regulations to the customs broker district permit fee.

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The agency made few changes from its proposed rule, including a new requirement that brokers must report breach of any known compromised importer identification numbers within 72 hours, in addition to requiring submission of any additional known compromised importer identification numbers within 10 days, and the consolidation of responsible supervision and control factors on responsiveness to CBP communications and internal communications. The final rules are set to be published in the Oct. 18 Federal Register, and will take effect Dec. 19.

In the final rule, CBP finalized a change related to responsible supervision and control that says CBP “may” consider factors listed in its regulations when assessing a broker, rather than “will” assess the factors. Commenters had said the change means CBP can now assess penalties on brokers for a single mistake rather than considering the broker’s compliance in its totality. CBP said that, despite the change, it will continue to consider factors on a “case-by-case” basis and that “no decisions will be made without a thorough evaluation of the relevant factors present that apply to an individual broker.”