[Federal Register Volume 63, Number 60 (Monday, March 30, 1998)]
[Notices]
[Pages 15259-15261]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-8220]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Customs Service
Announcement of National Customs Automation Program Test: Semi-
Monthly Statement Processing Prototype
AGENCY: Customs Service, Treasury.
ACTION: General notice.
-----------------------------------------------------------------------
SUMMARY: This notice announces Customs plan to test the semi-monthly
filing and statement processing program (semi-monthly processing), and
invites all eligible importers to participate. Semi-monthly processing
provides for periodic filing of entry summaries and payment of duties,
taxes, and fees. Semi-monthly processing allows filers to go to a
periodic statement and filing process, whereby all estimated duties,
taxes, and fees along with the corresponding entry summaries for a
semi-monthly period (fifteen days) are due seven days following the end
of a fifteen day period. This notice provides a description of the
semi-monthly processing prototype, outlines the evaluation methodology
to be used, and sets forth the eligibility requirements to participate.
EFFECTIVE DATES: The semi-monthly processing prototype will commence no
earlier than April 1998, will be implemented over an 18-month period,
and will end when the periodic payment/statement feature of ACE is
available through a NCAP/P test or otherwise in the semi-monthly
prototype ports. Evaluations of the semi-monthly processing at the
ports will be conducted periodically. All applications to participate
in the prototype test must be received within 30 days of the date of
this notice.
ADDRESSES: Applications should be addressed to Rosalyn McLaughlin-
Nelson, U.S. Customs Service, ACE, 7501 Boston Blvd, Springfield, VA
22153.
FOR INFORMATION CONTACT: For inquiries regarding the specifics of the
semi-monthly processing prototype contact Rosalyn McLaughlin-Nelson at
(703)921-7494. Individual port contact persons will be provided to the
participants at a later date. For inquiries regarding the eligibility
of specific importers, contact Margaret Fearon, Process Analysis and
Requirements Team (202) 927-1413.
SUPPLEMENTARY INFORMATION:
Background
Title VI of the North American Free Trade Agreement Implementation
Act (the Act), Pub.L. 103-182, 107 Stat. 2057 (December 8, 1993),
contains provisions pertaining to Customs Modernization (107 Stat.
2170). Subtitle B of Title VI establishes the National Customs
Automation Program (NCAP)--an automated and electronic system for the
processing of commercial importations. Pursuant to these provisions,
Customs is in the process of developing a new commercial processing
system, the Automated Commercial Environment (ACE). The ACE is being
designed to support the new Trade Compliance processes. One of the main
features of the ACE will be the periodic summary filing and periodic
statements function, which will enable each account to pay duties,
taxes, fees, and other payments owed using a periodic statement cycle.
During the latter development of the NCAP/P the periodic summary filing
and periodic statements functional capabilities will be fully
integrated into the new ACE system. Semi-monthly processing using the
current Automated Commercial System (ACS) will eventually cease as the
ACE system is deployed nationwide.
For programs designed to evaluate existing and planned components
of the National Customs Automation Program (NCAP), Sec. 101.9(b) of the
Customs Regulations (19 CFR 101.9(b)), implements the NCAP testing
procedures. This test concerns an existing component of the NCAP
relating to the electronic payment of duties, fees, and taxes, and is
established pursuant to that regulation.
I. Development Methodology
The semi-monthly processing test will be monitored by an evaluation
team consisting of representatives from the Customs Trade Compliance
Redesign/ACE Project Team, the Office of Finance, Financial Systems
Division, and Entry personnel from the semi-monthly processing
prototype ports. This team will conduct periodic evaluations to monitor
progress, resolve issues, and evaluate program effectiveness.
II. Eligibility Requirements
Customs will select a limited number of applicants for the semi-
monthly
[[Page 15260]]
processing prototype. Applications will be accepted from all
volunteers; however, priority consideration will be given to the
following ranking factors:
1. Companies ranking within the top 379 companies importing by
value (the top 379 represent approximately 50 percent of all imports by
value);
2. Importers who are within the top 250 largest importers within
each of Customs Primary Focus Industry (PFI) categories, which are:
a. Advanced Displays;
b. Agriculture;
c. Auto/Truck Parts;
d. Automobiles;
e. Bearings;
f. Circuit Boards;
g. Fasteners;
h. Footwear;
i. Manufacturing Equipment;
j. Steel Products;
k. Telecommunications;
l. Textiles and Flatgoods; and
m. Wearing Apparel;
3. Companies whose imports represent at least 50 percent PFI;
4. Companies that indicate they plan to maintain an average of at
least 25 entries per month throughout the prototype period;
5. Companies that are scheduled or have completed a Customs
Compliance Assessment; and
6. Companies that are capable of transmitting entry and entry
summary data via the Automated Broker Interface (ABI) and make payment
of estimated duties, taxes, and fees through the ABI/Automated
Clearinghouse (ACH).
III. Procedures and Restrictions
For the semi-monthly processing prototype, the following
restrictions will be placed on the importers:
1. Initially, only merchandise entered or withdrawn from a Customs
bonded warehouse or Foreign Trade Zone for consumption at the following
ports will be eligible for the semi-monthly processing prototype:
a. Seattle, Washington;
b. Detroit and Port Huron, Michigan;
c. Laredo and El Paso, Texas;
d. Buffalo and New York, New York;
e. Charleston, South Carolina;
f. Atlanta, Georgia;
g. Chicago, Illinois;
h. Miami, Florida;
i. Cleveland, Ohio; and
j. Los Angeles and San Francisco, California;
(If an applicant requests that an additional port or ports offer this
program, and if Customs accepts the request, an amendment to this
Federal Register Notice will be published).
2. Importers must have all transactions paid on an importer ACH
statement at each semi-monthly prototype port;
3. Importers must pay only estimated duty, taxes, and fees on the
semi-monthly statement;
4. Importers must have all entry summaries corresponding to all
entries released during the first semi-monthly period placed on an ABI
Statement and make payment via ACH on the seventh day following the end
of the first semi-monthly period. Payment must be initiated at the same
time the ABI statement is submitted to Customs;
5. For quota merchandise, the entry summary data must be filed
electronically and any applicable visa must be filed prior to release
of the merchandise. The payment must also be placed on the statement
prior to release of merchandise;
6. Items deleted from a statement may not be added to another
statement if quota status is already obtained and the new statement
date is greater than 10 working days past the presentation date;
7. All current Entry requirements associated with quota processing
will remain in effect;
8. Importers must have all entry summaries corresponding to all
entries released during the second semi-monthly period placed on an ABI
Statement and make payment via ACH on the seventh day following the end
of the second semi-monthly period. Payment must be initiated at the
same time the ABI statement is submitted to Customs;
9. For due dates that fall on a Saturday, Sunday or official
federal holidays, importers must make payment on the next federal
business day;
10. Importers must have final statements and required entry
summaries submitted by the actual payment due date, i.e., seven days
after the semi-monthly (fifteen days) period;
11. The statement will only reflect payment of duties, taxes, and
fees applicable to the merchandise released for the semi-monthly
period. The following activities are examples of what cannot be
included on the statement:
a. voluntary tenders;
b. supplemental duties;
c. bill payments resulting from rate advances;
d. protests;
e. refunds; and
f. drawbacks;
(These activities will be processed the way they are currently done, as
individual transactions).
12. Payments received after the corresponding due dates will be
considered late and will be subject to liquidated damages;
13. When a statement is paid late, the liquidated damages will be
issued against all of the entry summaries paid on the statement; and
14. If an entry summary(s) is omitted from the statement and the
statement is timely, then liquidated damages will be issued against the
omitted entry summary(s). An omitted entry summary(s) cannot be paid
individually. It must be placed on the next statement.
Customs Entry personnel at each of the prototype expansion ports
will monitor entry activity to ensure that entries are appearing on the
appropriate statement; ACH payments are authorized timely; and, entry
summary(s) are not submitted late.
This prototype only applies to entries for consumption. Importers
may enter merchandise in the semi-monthly processing prototype that is
subject to quota, antidumping or countervailing duty, trade preference,
or visa requirements. In addition, importers may withdraw such
merchandise from a customs bonded warehouse or Foreign Trade Zone and
enter it for consumption under the prototype. However, all entry
requirements for these types of merchandise will remain in effect.
IV. Application
Importers that wish to participate in the semi-monthly processing
prototype port expansion must submit a written application and include
the following information:
1. Name(s) of the port(s) listed above where they intend to enter
merchandise;
2. The importer of record numbers, including suffix;
3. Name and addresses of any customs brokers who will be filing
data at each port on behalf of an importer/participant;
4. The approximate total number of entries per month expected to be
processed at the ports designated; and
5. For applicants not already scheduled for or participating in a
Customs Compliance Assessment, a statement in which the applicant
indicates agreement to undergo and cooperate fully with a Customs
Compliance Assessment.
Customs will notify each applicant in writing of their acceptance
or nonselection to participate in this semi-monthly processing
prototype, the port or ports where they may enter merchandise under
this prototype, and will assign statement filing dates to the
applicants. If an applicant is denied participation, the applicant may
appeal in writing to Director, ACE Implementation and Outreach Team,
[[Page 15261]]
U.S. Customs Service, 7501 Boston Blvd., Springfield, VA 22153, within
10 days from applicant notification from Customs.
V. Semi-Monthly Processing
Under the semi-monthly processing procedures, cargo released during
a fifteen day period will have estimated duty, taxes, fees, and
summaries due seven days following the end of the period. Cargo
released during the second fifteen or sixteen day period will have
estimated duty, taxes, fees, and summaries due seven days following the
end of the period. A separate statement will be needed for each
collection processing port. For entry summaries paid via semi-monthly
statement processing, the date used to calculate the interest due or
payable pursuant to 19 U.S.C. 1505 will be seven days after the end of
the fifteen/sixteen day cycle. Interest cost will be calculated based
on the semiannual rate(s) established under sections 6621 and 6622 of
the Internal Revenue Code of 1954 (26 U.S.C. 6621, 6622).
Under the prototype, Customs may assign a limited number of due
dates for workload management purposes. The due dates that will be
assigned are:
1. 1 thru 15, due 22; 16 to end of month, due 7.
2. 2 thru 16, due 23; 17 thru 1, due 8.
3. 3 thru 17, due 24; 18 thru 2, due 9.
4. 4 thru 18 due 25; 19 thru 3, due 10.
The due dates will be indicated in the letter of acceptance sent by
Customs to the participant.
VI. Misconduct
If a prototype participant makes late or inadequate payments, or
fails to exercise reasonable care in the execution of participant
obligations and the filing of information regarding the admissibility
of merchandise and declaring the classification, value, and rate of
duty applicable to the merchandise, or otherwise fails to follow the
procedures (outlined herein) or applicable laws and regulations, then
the participant may be suspended from the semi-monthly processing
prototype, and/or subjected to penalties, and/or liquidated damages,
and/or other administrative sanctions. Customs has the discretion to
suspend a prototype participant based on the determination that an
unacceptable compliance risk exists. This suspension may be invoked at
any time after acceptance in the prototype.
Any decision proposing suspension of a participant may be appealed
in writing to the local Trade Compliance Process Owner within 15 days
of the decision date. Such proposed suspension will apprise the
participant of the facts or conduct warranting suspension. Should the
participant appeal the notice of proposed suspension, the participant
should address the facts or conduct charges contained in the notice and
state how he does or will achieve compliance. However, in the case of
willfulness or where public health interests or safety are concerned,
the suspension may be effective immediately.
VII. Regulatory Provisions Suspended
As applicable, certain provisions within Parts 24, 111, 141, 142,
143, and 159 of the Customs Regulations (19 CFR Parts 24, 111, 141,
142, 143, and 159) will be suspended to allow for the periodic payment
of duties, taxes, and fees.
Absent any specified alternate procedure, the current regulations
apply.
VIII. Prototype Evaluation
Periodic evaluations will be conducted to determine effectiveness
and accrued benefits to internal and external process operations. The
following evaluation method has been suggested:
1. Evaluation questionnaire from both the prototype participants
and Customs personnel; and
2. Reports to be run through the use of dataqueries.
Customs will request that participants be active in the evaluation
of the semi-monthly test.
Dated: March 24, 1998.
Charles W. Winwood,
National Trade Compliance Process Owner.
[FR Doc. 98-8220 Filed 3-27-98; 8:45 am]
BILLING CODE 4820-02-P