Important update for those who import shipments into the US via the US border

[hlmacdon]

If you are currently crossing the US border to import customer shipments for reshipment via a US carrier/USPS there are changes to the requirements. Previously shipments that qualified as Section 321 informal entries (essentially goods to a consignee that are under the de minimis) was exempt for emanifest requirements and you could simply use a paper form and show up at the border with that and supporting paperwork.

If you cross now you should start receiving a handout with information, but the gist is starting November 26 if you haven't filed electronic manifests you'll be referred to secondary for processing. Starting January 1st of next year, the penalty will be $5000 for first attempt at not complying with electronic manifest requirements, then $10,000 for subsequent. In order to file electronic manifests you'll need to apply for a SCAC code, which is $75 USD/year via the NMFTA.  You will also need to apple for ACE Portal access, which is the US government's free solution for filing. There are third party providers but their pricing models are not really targeted at lower volume individuals/small businesses. ACE Portal access approval can take several weeks so you may want to start looking into this sooner rather than later.

TLDR everything crossing the US border now has to be filed electronically. If you weren't following proper procedures before and not declaring your packages, get on board with official procedures or expect a very expensive trip if you cross next year.

[ichopshop]

Here the handout I received when crossing earlier today.

Ian

[hlmacdon]

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@ichopshop wrote:

Here the handout I received when crossing earlier today.

Ian

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In case you didn't get the second page, or for other's reference there was another page with information on applying for a SCAC which is required to use either the ACE system or any third party system.

[ichopshop]

Thank you so much for this!  This answers a bunch of questions I had...... This is by far a much more important sheet!!!!

Ian

[ichopshop]

Was told today at the border that there may be a day in implementing this new requirement...

Ian

[hlmacdon]

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@ichopshop wrote:

Was told today at the border that there may be a day in implementing this new requirement...

 Ian

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They didn't mention anything today at the border but it would not surprise me. In talking with one of the listed points of contact, they themselves are still struggling to get all the information they need to advise people on the process and were caught off guard by this.

[hlmacdon]

Some additional information that gives more background here. From what I was told there are more changes expected later in the year. The key driver (apart from better insight into what is coming in) is all the various regulatory agencies (ie FDA) wanting better insight into what is coming in. I can forsee  these changes resulting in some categories of products being exempt from informal entries in the future. 

[ichopshop]

Got SCAC code ($76 usd later for an email).

Now applying for an IR# (Importer Number) before I can complete the ACE Portal application.

https://www.cbp.gov/sites/default/files/assets/documents/2018-Aug/CBP%20Form%205106%20%2805-2013%29-...

Fill this out and bring it to the Port of Entry.

Not sure how long it takes to get the number....

[hlmacdon]

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@ichopshop wrote:

Got SCAC code ($76 usd later for an email).

Now applying for an IR# (Importer Number) before I can complete the ACE Portal application.

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Not sure how long that would take. If you are only transporting S231 goods to retail customers then an IR# is not required and you can just apply as a truck carrier. Ace portal activation itself is quick, took less than 24 hours to get that done once emailed to them. 

[ichopshop]

Can you help me out then....  I'm getting stuck at the first set of questions.

Section 1.

I assumed I'm applying as an Importer which requires an IR#.  Am I doing this wrong?

Thanks,

Ian

[hlmacdon]

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@ichopshop wrote:

Can you help me out then....  I'm getting stuck at the first set of questions.

 Section 1.

 I assumed I'm applying as an Importer which requires an IR#.  Am I doing this wrong?

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If you are only transporting section 321 goods via your/company vehicle:

• Fill out name of company (ie if sole proprietor your dba ie John Smith's Collectibles or your corp info) and related field in Section A
• Skip all the way down to section 4 d, everything from section 1 down to that point should be set to NA in the P/O/NA fields. Under Truck Carrier set that to Primary and fill in your SCAC #.  Bond fields are NA. 
• Section B fill out individual information under Part 1 if sole proprietor or Part2 if not sole proprietor.

That was the information I was given by the listed point of contact as well as calling in to the Ace help line (they have a 24 hour line but you have to call during regular hours for assistance that isn't of a technical support nature). If you are unsure of anything just give them a shout and walk them through your activities. The above applies if you are basically just transporting ecommerce goods that are below the de minimis and qualify for informal entry. 

[ichopshop]

Thanks again!

I'll give this a try tomorrow!

Ian

[ichopshop]

My ACE account is all set up!  Thanks so much for the help.

Now I'm trying to generate my first manifest.  I'm stuck on the Shipper and Consignee section.

I assume I'm the shipper?  Is this correct?

As for consignee, that would be the recipient of the package I assume?  I generally ship 10-15 items each time I cross, will I have to create a manifest for each package?

Thanks,

Ian

[hlmacdon]

@ichopshop wrote:

My ACE account is all set up!  Thanks so much for the help.

Now I'm trying to generate my first manifest.  I'm stuck on the Shipper and Consignee section.

I assume I'm the shipper?  Is this correct?

As for consignee, that would be the recipient of the package I assume?  I generally ship 10-15 items each time I cross, will I have to create a manifest for each package?

Thanks,

Ian

That is correct, you are the shipper and the consignee is the recipient for each individual package. You can store recipient information which is handy if you have repeat customers.  What you are basically doing is creating a manifest that is comprised of multiple individual shipments. You create a shipment for each consignee then add those to a single manifest.

To start the process create a manifest. Conveyance is your vehicle, crew member is you, and when it prompts you for an address when you add the crew member you need a US address so just use the post office address.  Then you have to create shipments for every package. When creating your shipment change the type from PAPS to S321 (if under $800). Each shipment needs a unique number so just use something like the date and ascending numbers. Under the equipment select conveyance and hit add.  Add your recipient and commodity information. Save when done and repeat for each shipment.  Once you have added all shipments check for errors then transmit the manifest and print the cover sheet, which you'll need to keep on you when going across the border.

Save your progress often as it can be a bit flakey. They are working on a more modernized portal but this is what we have to work with for now as most third party services are very expensive since their pricing model is typically based on the number of shipments. If you get stuck check out some of the videos from various third party providers. They will refer to things a bit differently as their layouts and data fields may be titled or sequenced differently, but the basic concepts are the same.

They recommend submitting a minimum of 1 hour prior to going to the border.  The first few times you go through the process it will take you a long time so I recommend leaving yourself plenty of time.  You may want to keep the old forms on hand for the first few times so you have a backup while they are still giving some leeway.

[ichopshop]

Managed to generate my first ACE manifest today.  Got to the border and the agent couldn't find it.  Not sure why, as far as I can tell I did everything correctly.  I generated the paper style manifest just in case so that's what I ended up using.

The agent told me that they wouldn't be enforcing the requirement for Sect 321 entries to create an electronic manifest.  Don't know if this is official now but I've been hearing that this was going to be the case for a week or two...

Ian

[hlmacdon]

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@ichopshop wrote:

Managed to generate my first ACE manifest today.  Got to the border and the agent couldn't find it.  Not sure why, as far as I can tell I did everything correctly.  I generated the paper style manifest just in case so that's what I ended up using.

The agent told me that they wouldn't be enforcing the requirement for Sect 321 entries to create an electronic manifest.  Don't know if this is official now but I've been hearing that this was going to be the case for a week or two...

Ian

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Did you have the coversheet that they scanned to look it up? There is a delay time before it is active in their system apparently, hence the 1 hour recommendation before you attempt to cross the border. If you used the check for error functions to ensure everything was complete and it submitted and allowed you to print a coversheet it should be active in their system that day unless they had some sort of glitch.

Regarding not enforcing, I wonder how well informed the person you spoke with as the whole point of the change is so that multiple US regulatory agencies can get insight into what is coming into the country as S321 declared shipments. The person in charge of the program has certainly not given any indication of any changes and on recent trips nothing has been mentioned by any of the guards. At the crossing I use the have been telling people to hurry up and get switched over to using the ACE system. I can't see them changing things given that there are a lot of people abusing the program as it stood. That being said it isn't unusual to get different answers from different people. 

[a52split]

I did the old paper entry with an item on Nov 24 and asked the guy about when the new system would be live.  He said it would be a while and that he's heard nothing about how the new system would work through their channels.

I did another shipment across the border last Sat, Dec 8 , again with the old 7533 form.  It was business as usual and I was on my way with no mention of the new procedure.

At this point, I can't see them handing out $5000 fines on Jan 1 when they aren't up to speed themselves yet.

[hlmacdon]

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@a52split wrote:

I did the old paper entry with an item on Nov 24 and asked the guy about when the new system would be live.  He said it would be a while and that he's heard nothing about how the new system would work through their channels.

I did another shipment across the border last Sat, Dec 8 , again with the old 7533 form.  It was business as usual and I was on my way with no mention of the new procedure.

At this point, I can't see them handing out $5000 fines on Jan 1 when they aren't up to speed themselves yet.

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It's live already. There is nothing new about the system, emanifests are used every day for the typical commercial lane traffic on both sides of the border. The only new element is when they flip the switch and require all commercial importations regardless of classification to be done solely via emanifests. Where there is a knowledge gap is that border guards don't know how to use the system from an end user point of view. You will get different responses from different border guards as this is just one aspect of their responsibilities, some are paying attention and advising people others are not. Some are already fed up with people showing up at the border not knowing how to file an emanifests. They are not the people you should be talking to. When they are told they have to hard enforce a policy, they will start doing so.

The point of contact in charge of this (Amy Hatfield) is listed here and I would advise people to talk the time to call and talk to that person if they have questions. You have time now to lean how to use the system and I would strongly suggest you do so. Commercial importations across the border are not something to take casually. 

[ichopshop]

I've now crossed 5 times using ACE Manifests.  It's fairly straightforward once you have it setup and do it once or twice.  The help I got form @hlmacdon was invaluable.  Basically follow the steps in this thread to get setup.

I've been hearing mixed information from the Officers as to exactly what happens on Jan 1.  Most seem to think it won't be enforced against small importers but wouldn't commit.  They tell me the change was really made to close a loophole that was allowing large shippers (trailer loads) to use informal entry.

The general consensus is that even if the new rules don't take effect Jan 1 they will at some point.  Not to mention it only takes one Officer to have not read their emails to ruin your day.  If you can get setup before Jan 1 I would.

Ian 

[hlmacdon]

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@ichopshop wrote:

I've been hearing mixed information from the Officers as to exactly what happens on Jan 1.  Most seem to think it won't be enforced against small importers but wouldn't commit.  They tell me the change was really made to close a loophole that was allowing large shippers (trailer loads) to use informal entry.

Ian 

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In talking with Amy as well as others there are a few things at play. The most pressing issue is the Partner Government Agencies (ie Department of Agriculture, Health, Commerce, Justice, etc agencies) want more oversight and insight into items falling under their jurisdiction that are entering the US as informal entries. For that reason alone this will be happening. Section 321 entries were never really intended for ecommerce. They were originally created to facilitate things like sales/manufacturer reps bringing samples across the border. The US has seen a large growth in informal entries with ecommerce and at the moment it is very hard for any real inspection of shipments to happen other than on a completely random spot check basis as they have no information to allow them to pre-screen shipments prior to arrival like they do with all emanifest shipments.

Why in particular these agencies want more insight ties into what you heard somewhat. Large trailer loads aren't coming in full of informal entry product, but what is happening is that exporters (primarily China) are abusing the program and breaking down larger commercial consignments of products that would otherwise require formal entry and by doing so are in particular avoiding a lot of the regulatory scrutiny that would otherwise be far more likely to occur when product crosses. These larger consignments are being broken down into smaller consignments and mixed in with other loads or being sent via forwarding companies. 

If you look at UPU developments and what the US along with others are trying to do you can get a picture of how this ties together. There is a concerted push to get all shipments containing non-documents into specific mailing classes that will provide advanced manifests of all inbound product into customs, hence the push to get physical goods out of lettermail classes. All agencies want to start taking a much closer look at what is coming in that has regulatory oversight. The only way this happens is by a) getting data to customs officers electronically ahead of time so shipments can be flagged and pulled for inspection and b) getting electronic data that can be compiled so that necessary statistical information can be generated.

Having your emanifests filed makes for a much smoother border experience as well. Border staff can do their jobs more effectively and a happy border guard makes for smooth sailing for all parties.  Just keep in mind that when you are doing this you are actively carrying on a business and transporting product into another countries. The onus to know what is required and the liability associated with not knowing or ignoring what is required falls squarely on the shoulders of only one party. One of the most commonly used phrases at the border is ignorance of the law is no excuse.