The global logistics industry has had a full year to adjust to industry-changing Importer Security Filing (ISF, or 10+2) regulations before they become fully enforced by U.S. Customs and Border Protection (CBP) on Jan. 26, 2010.
Aimed at preventing acts of terrorism, the 10+2 ruling requires ocean cargo information to be transmitted to Customs at least 24 hours before being loaded onto a vessel in the foreign port.
“Because noncompliance in the form of data errors and late transmissions can result in severe financial penalties between $5,000 and $10,000 per shipment, timely receipt of information and documentation from overseas suppliers, shippers and cargo agents has never been more critical for the global supply chain community,” says Paul Codere, corporate Customs brokerage manager for AIT Worldwide Logistics, Inc.
Smart Business spoke with Codere about how the industry has adjusted to the ISF phase-in period and his advice for Customs brokers and importers once CBP begins full enforcement of the ruling.
Why did Customs give the industry a trial period with the ISF regulations?
Customs afforded the entire industry a yearlong delayed compliance period to acclimate to the new mandates. The intent behind this initiative was for the international trade community to take the full 12 months to work together in educating themselves on complying and cooperating with 10+2. Importers have been warned of infractions rather than being fined so that, ultimately, it will only mean business as usual when full enforcement begins.
First, importers had to decide whether or not they were going to complete their ISF compliance individually or with the security filing assistance of agents like Customs brokers, who have the internal processes, resources and capabilities necessary to file the sensitive data requirements.
Working together to streamline their security filing procedures, brokers, agents and importers have been held responsible for organizing data, implementing a software solution to facilitate the process, and transmitting timely and accurate 10+2 filings to U.S. Customs.
Collectively, the implementation of 10+2 has been quite a challenge for the industry. Customs has advised mitigating factors for when they begin enforcing bond guidelines and deadlines, and I am quite confident that the steep financial penalties will absolutely drive 10+2 compliance.
Customs has stated that without fines, the industry might not take ISF seriously.
