Tuesday, December 2, 2008

CBP Publishes Final Rule on "10+2"

CBP Publishes Final Rule on “10+2”

On November 25, 2008, U.S. Customs and Border Protection (CBP) issued the Importer Security Filing and Additional Carrier Requirements final rule, which will be effective on January 26, 2009. Currently, carriers are required to submit advance cargo information for vessels to CBP no later than 24 hours before the cargo is laden aboard a vessel at a foreign port (the “24 Hour Rule”) via the Vessel Automated Manifest System (AMS). Based upon comments from the trade community and Congress, the final rule is a more moderate version of the proposed rule.

Under the new rule, in addition to the 24 Hour Rule, carriers must submit a vessel stow plan and container status messages for certain events relating to all containers destined to arrive in the U.S. This is the “+2” in the “10+2.” CBP must receive the vessel stow plan no later than 48 hours after the carrier’s departure from the last foreign port. For those voyages less than 48 hours in duration, CBP must receive the plan before the vessel first arrives at a U.S. port. The following standard information must be included:

1. Vessel name (including international maritime organization number);
2. Vessel operator;
3. Voyage number;
4. Container operator;
5. Equipment number;
6. Equipment size and type;
7. Stow position;
8. Hazmat code, if applicable;
9. Port of lading; and
10. Port of discharge.

The “10” in the “10+2” refers to the ten data elements that CBP now requires importers to transmit to CBP for cargo other than foreign cargo remaining on board, no later than 24 hours before the cargo is loaded onto a vessel bound for the U.S. The ten elements are:

1. Seller;
2. Buyer;
3. Importer of record number/foreign trade zone applicant identification number;
4. Consignee number(s);
5. Manufacturer (or supplier);
6. Ship to party;
7. Country of origin;
8. Commodity HTSUS number;
9. Container stuffing location; and
10. Consolidator (stuffer).

The information transmitted to CBP under the Importer Security Filing will be treated as confidential in accordance with the SAFE Port Act of 2006 and section 343(a) of the Trade Act of 2002. Failure to comply with these new requirements could result in liquidated damages of $5,000 per violation, up to a maximum of $100,000 per vessel arrival. Failure to provide a vessel stow plan will result in liquidated damages of $50,000 per vessel arrival. However, CBP has indicated that it will exercise some leniency in enforcing the rule for the next 12 months to allow importers to overcome any difficulties they may have in complying with these new requirements.