Customs Facilitation 'Framework' Published; Legislative Timeline Not Estimated

Sen. Bill Cassidy, R-La., who is a co-sponsor on a bill that largely reflects CBP's customs modernization proposal (see 2312120078), was joined by Sen. Catherine Cortez-Masto, D-Nev., in putting forward some broad topics they plan to address in a trade facilitation bill. Cassidy's office said there is no timeline for a bill introduction. Because the process is in the early stages, they also don't know if these proposals will be folded into a combined enforcement and facilitation bill when it is reintroduced in the next Congress, or whether there will be two bills.

The elements in the framework are those that the senators agreed needed to be tackled; they are informed by feedback they received when they asked for detailed input a year ago on how to improve customs processes.

There is next-to-no detail in this first public product after that information gathering. The framework says the legislation will enhance ACE, and will streamline data requirements from CBP and partner government agencies. It said the goal is a one-stop-shop at the border for decision-making.

Nicole Bivens Collinson, director of Sandler Travis's international trade and government relations practice, said she is encouraged by the framework. "The first step is recognizing what the problems were," she said. The framework talks about the same example that Senate Finance Committee ranking member Mike Crapo mentioned at a hearing on customs modernization, the duplicative and conflicting data requests needed to import wet cat food. "The example I think that they gave, sends a clear indication of what the problem is," she said.

She said "it's completely ridiculous" that different laws define an entry of goods differently. She said the idea of a true one-U.S.-government decision-making process at the ports is the right one. "I’m not sure the mechanics of how it would get done," she said.

The framework says it will create a statutory authority for the Border Interagency Executive Committee, which is a forum the government has to try to harmonize PGA requests and CBP requests of importers.

The way PGAs affect imports is a major irritant for traders; National Customs Brokers & Forwarders Association of America President JD Gonzalez said last year that many PGAs give a 30-day conditional release, and sometimes they ask for the item back a few days after CBP cleared it. "One thing we’re trying to get: Release means release," he said then.

The framework says the bill will simplify drawback procedures. When asked how drawback would be simplified, a Senate aide said: “We’re still working through the details, so we don’t want to share too much."

John Pickel, senior director of international supply chain policy for the National Foreign Trade Council, wrote in response to the framework: "It's encouraging to see that this high-level document includes several principles that were endorsed by NFTC and a dozen other trade associations in June 2023. There still needs to be some flesh on the bones to get to a place where this framework balances facilitation with the enforcement emphasis in other processes.

"We hope there will be an opportunity to help build out these principles. Many of the authorities described already exist, but the higher value of facilitation legislation is to tie those authorities together. The opportunity in this process is to create a unified government approach to efficiently processing cargo coming to the U.S. with infrastructure to deconflict entry requirements, include industry to ensure compliance is achievable, and collaborate to make sure required data actually addresses well-defined objectives."

On how drawback processes could be improved, Bivens Collinson said, "I think one of the biggest complaints that we have is the time that it takes for submissions, reviews, processing, determinations." She said the exporter who is seeking drawback is not necessarily the importer, and that causes red tape.

The framework says: "In an effort to support importers on the post-entry and clearance procedures for imported merchandise impacted by admissibility issues including forced labor, the framework provides for Centers of Excellence to identify and provide access to import and entry specialists on an industry or sector basis."

However, CEE specialists are reachable when goods are detained, and in some cases, the specialists will tell you what red flags in documentation they spotted that led to a rejection (see 2403280056). The complaint is not that you have no access to CEE specialists, but that some staffers don't give any information about why a shipment was rejected -- or even, why an applicability challenge was successful (see 2311090054).

Bivens Collinson said there's both an access problem and an information problem. She said Customs officials are moved to different jobs frequently, and when you find out the person you used to be able to contact is no longer in that job, there's "no information who’s got that portfolio, what’s their contact information. That’s a frustration for many people." She said creating the Centers of Excellence and Expertise was a major advance in reducing silos at CBP, but she said more can be done.

The framework said: "Many trade opportunities exist to ease the flow of goods across the border while also maintaining the level of enforcement necessary to combat issues like forced labor and counterfeits. Customs modernization must strike the appropriate balance of reducing burdens and costs for the trade industry while maintaining safety and security."

The trade facilitation bill, when introduced, will request a study from the Government Accountability Office on the duty and fee structure, and recommend changes in either to Congress.

The framework says the senators will introduce language to streamline "the export process and provides that clerical errors in submission of export data should be exempted from penalties if not part of a pattern of violative conduct."

While some of the framework ideas seem to respond to trade interests' proposals from last summer (see 2306060057), such as codifying the BIEC, the senators are not yet endorsing specific requests for information sharing, such as requiring CBP to tell importers what specific component in a detained shipment is suspected of being tainted by forced labor.

There are also things the trade would like to see -- like requiring CBP to send refunds of duties with electronic payments -- that were not mentioned in the framework. Bivens Collinson said she doesn't think that necessarily means they won't end up in the bill text.

"What they’ve done is put out those big issues around which they could get consensus and support," she said. "There may be smaller things that may be more niche oriented" that could follow later. "The devil will be in the details."

She said some trade asks might not have made it into the framework because "there may have been some push-back from CBP on things because they’re concerned about funding."