Simplified Entry and Financial ProcessSimplified Entry and Financial ProcessCBP Trade Integrated Planning

and Coordination Cell Initiative

Commercial Operations Advisory Committee

Subcommittee on Trade Facilitation

August 18, 2011

1. Business Issue/Problem Statement

2. Simplified Entry, Summary, and Financial Overview

3. Proposed Model

4. Key Considerations and Challenges

5. Next Steps

AgendaAgenda

2

Business Issue/Problem StatementBusiness Issue/Problem Statement

3

Current environment Entry, Summary, and Financial requirements are misaligned with industry, resulting in

a lack of uniformity, increased costs, and inefficient trade facilitation and enforcement Redundant paperwork requirements, archaic policies, procedures, and technology

slow the trade process and cause unnecessary delays Current processes are stuck within old laws and regulations and differentiating

between trusted and suspicious importers is difficult

Proposed environment A viable Simplified Entry, Summary, and Financial solution that is business- and

CBP-friendly to streamline and remove administrative burdens 21st century, world-class trade environment that will free the U.S. from 18th century

laws, regulations, and thinking that is no longer compatible with a global economy Facilitating trade of CBP's trusted partners, while focusing on importers of concern

In 2010, Commissioner Alan Bersin issued a call for both industry and government to consider how import trade processes can be re-engineered to meet the technological needs of the 21st century

U.S. Customs and Border Protection (CBP) established a workgroup to examine how import processes may be simplified to reduce the cost to both U.S. business and the government

Workgroup members come from both government and industry, including importers, brokers, carriers, and association representatives

Workgroup has held multiple facilitated sessions to discuss the issues, review industry processes, and achieve a "strategic breakthrough" by assessing potential solutions

Simplified Entry, Summary, and Simplified Entry, Summary, and Financial OverviewFinancial Overview

4

The Simplified Processes Workgroup is proposing a model that will:

Reduce filings involved in obtaining release for low risk companies Decrease release timeframes by satisfying CBP requirements and obtaining

release preferably before arrival Align summary requirements with importer business models Link summary and financial submissions, expands the timeframe for

submitting entry summary, and allow users to consolidate the payment of duties, taxes, and fees

Proposed Model: OverviewProposed Model: Overview

5

Key Process Changes Admissibility is tied to 10-14 key

data elements transmitted to CBP Process can be mode-specific Standardizes filing requirements

across industries Streamlines current CBP

paperwork forms, as necessary, required for filing

Reduces entry data requirements to prevent duplication and repetition

CBP policies and business rules will be revised as necessary to accommodate changes

6

Proposed Model: Entry and ReleaseProposed Model: Entry and ReleaseEntry & Release

Key Activities

ASNISF

ManifestACAS

Broker

Entry3461

CBP Servers

Submit Key Data Elements for Entry

Security & admissibility tied together

Carrier

Importer

Entry & Release at the Ports

INV

EN

TO

RY

RE

CE

IPT

RE

CO

RD

ED

IN

IMP

OR

TE

R’S

AC

CO

UN

TIN

G S

YS

TE

M

Modes of Transportation

Summary & Financial

Air Cargo Air Express

Leveraging currently available data sets

Proposed Model: Summary & FinancialProposed Model: Summary & FinancialKey Process Changes True management by account Summary and payment are linked

and happen simultaneously Entry summary and payment are

no longer tied to release Instead, process is specific to

importer's business model and account practices Importer will summarize all entries

that hit inventory within its "business month" on one entry summary

Importer will have up to 30 days after close of that business month to make necessary amendments to entries, then file summary and financial at the same time

7

Summary & Financial

Key Activities

Collect Data for Summary Submit Summary and Payment

Entry Summary

Entry Summary Statement Importer of Record #: 12-003456789 Period of Summary: January 1, 2012 – February 4, 2012 Line HTS Country of Origin Total Value

001 A4414.00.0000 ID $215,405.00 002 4414.00.0000 CN $1,044.18 003 4414.00.0000 VN $35,983.80 004 4414.00.0000 JA $10,890.50 Adjustments 4815.00.0000 - $1,350.23 Roll-Up of Duties by Line

CBP Application & Financial Servers

Summary

Importer

Business Month #1 Business Month #2

Entry Data

Importer

IMPORTER ACCOUNTING SYSTEM

8

Key Challenges and ConsiderationsKey Challenges and ConsiderationsSimplified Entry Simplified Summary and Financial

Key Considerations

Linking security and admissibility to release of shipments

De-linking release from summary Requiring only those data

elements necessary to determine security and admissibility

Efficiencies gained from both a CBP and industry perspective

Compatibility with participating government agency models

Management by account Decoupling summary and financial

requirements from release transactions

Reducing repetitive data filings Aligning summary and financial

submissions to importer business models

Increasing accuracy of data submissions

Key Challenges Qualifications for participation Required statutory and regulatory

changes, including penalty regime Technology adjustments and

enhancements Aligning participating government

agency (PGAs) data requirements with streamlined entry and release

Addressing non-standard or low value shipments

Change management requirements across CBP and business

Qualifications for participation Required statutory and regulatory

changes, including penalty regime Technology adjustments and

enhancements Calculating interest payments Liquidation Merchandise Processing Fees

Brief the Commercial Operations Advisory Committee (COAC) on proposed Simplified Entry, Entry Summary, and Financial models in mid-August 2011

Continue consultations with PGAs Finalize proposal to present to Commissioner Bersin in October 2011 Approve and pilot models in FY2012

9

Next StepsNext Steps

Contact Information:Brenda B. SmithExecutive Director, Trade Policy and ProgramsOffice of International Tradebrenda.brockman.smith@dhs.gov