[Federal Register Volume 73, Number 1 (Wednesday, January 2, 2008)]
[Proposed Rules]
[Pages 90-113]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-25306]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF HOMELAND SECURITY

Bureau of Customs and Border Protection

19 CFR Parts 4, 12, 18, 101, 103, 113, 122, 123, 141, 143, 149 and 
192

[USCBP-2007-0077]
RIN 1651-AA70


Importer Security Filing and Additional Carrier Requirements

AGENCY: Customs and Border Protection, Department of Homeland Security.

ACTION: Notice of proposed rulemaking.

-----------------------------------------------------------------------

SUMMARY: To help prevent terrorist weapons from being transported to 
the United States, vessel carriers bringing cargo to the United States 
are currently required to transmit certain information to Customs and 
Border Protection (CBP) about the cargo they are transporting prior to 
lading that cargo at foreign ports of entry. This document proposes to 
require both importers and carriers to submit additional information 
pertaining to cargo before the cargo is brought into the United States 
by vessel. CBP must receive this information by way of a CBP-approved 
electronic data interchange system. The information required is 
reasonably necessary to further improve the ability of CBP to identify 
high-risk shipments so as to prevent smuggling and ensure cargo safety 
and security. The proposed regulations are specifically intended to 
fulfill the requirements of section 203 of the Security and 
Accountability for Every (SAFE) Port Act of 2006 and section 343(a) of 
the Trade Act of 2002, as amended by the Maritime Transportation 
Security Act of 2002.

DATES: Written comments must be submitted on or before March 3, 2008.

ADDRESSES: You may submit comments, identified by docket number, by one 
of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments via docket number
    Dept: [INSERT DOCKET NUMBER].
     Mail: Border Security Regulations Branch, Office of Trade, 
U.S Customs and Border Protection, 1300 Pennsylvania Avenue, NW. (Mint 
Annex), Washington, DC 20229.
    Instructions: All submissions received must include the agency name 
and document number for this rulemaking. All comments received will be 
posted without change to http://www.regulations.gov, including any 
personal information provided. For detailed instructions on submitting 
comments and additional information on the rulemaking process, see the 
``Public Participation'' heading of the SUPPLEMENTARY INFORMATION 
section of this document.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov. Submitted comments 
may also be inspected on regular business days between the hours of 9 
a.m. and 4:30 p.m. at the Office of International Trade, Customs and 
Border Protection, 799 9th Street, NW., 5th Floor, Washington, DC. 
Arrangements to inspect submitted comments should be made in advance by 
calling Mr. Joseph Clark at (202) 572-8768.

FOR FURTHER INFORMATION CONTACT: Richard Di Nucci, Office of Field 
Operations, (202) 344-2513.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Public Participation
II. Background
    A. Current Requirements and CBP Authority for Issuance of 
Proposed Rule
    (1) 24 Hour Rule
    (2) Trade Act Regulations
    (3) SAFE Port Act
    B. Statutory Factors Governing Development of Regulations
    C. Carrier and Importer Requirements Presented Separately
III. Proposed Carrier Requirements Relating to Vessel Cargo Destined 
to the United States
    A. Overview; Vessel Stow Plan
    B. Overview; Container Status Messages
    1. Events Requiring a CSM, Effective Upon Implementation of the 
Final Rule
    2. Additional Events Requiring a CSM, Effective 90 Days After 
CBP Publishes a Notice in the Federal Register
IV. Proposed Importer Requirement for Vessel Cargo Destined to the 
United States
    A. Overview; Required Elements
    1. Shipments Other Than FROB, IE Shipments, and T&E Shipments
    2. FROB, IE shipments, and T&E shipments
    B. Public Comments; Required Elements
    C. Overview; Master Bills/House Bills
    D. Public Comments; Master Bills/House Bills
    E. Overview; CBP-approved Electronic Interchange System
    F. Public Comments; CBP-approved Electronic Interchange System
    G. Overview; Authorized Agents
    H. Public Comments; Authorized Agents
    I. Public Comments; Requested Exemptions/Exclusions From 
Importer Security Filing Requirements
    1. Bulk and Break Bulk Cargo
    2. Foreign Cargo Remaining on Board, In-bond Shipments, and 
Instruments of International Traffic
    J. Overview; Updating an Importer Security Filing
    K. Public Comments; Withdrawing an Importer Security Filing
    L. Overview; Importer Security Filing, Entry, and Application 
for FTZ Admission
    1. Importer Security Filing and Entry
    2. Importer Security Filing and Application for FTZ Admission
    M. Public Comments; Importer Security Filing, Entry, and 
Application for FTZ Admission
V. General Public Comments
    A. Economic Analysis; Cost, Benefit, and Feasibility Study
    B. Protection of Confidential Information Presented to CBP
    C. Test of Concept and Phase-in Enforcement
    D. Other General Comments
VI. Amendments to Bond Conditions
    A. Bond Conditions Related to the Proposed Importer Security 
Filing, Vessel Stow Plan, and Container Status Message Requirements
    B. Bond Conditions Related to the Trade Act Regulations
VIII. Regulatory Analyses
    A. Executive Order 12866
    B. Regulatory Flexibility Act
    C. Unfunded Mandated Reform Act
    D. Paperwork Reduction Act
IX. Signing Authority
X. Proposed Regulatory Amendments

Abbreviations and Terms Used in This Document

AAEI--American Association of Exporters and Importers
AAPA--American Association of Port Authorities
ABI--Automated Broker Interface
ACE--Automated Commercial Environment
AMS--Automated Manifest System
ANSI--American National Standards Institute
ATDI--Advance Trade Data Initiative
ATS--Automated Targeting System
CBP--Customs and Border Protection
COAC--Departmental Advisory Committee on Commercial Operations of 
Customs and Border Protection and Related Homeland Security 
Functions
CFR--Code of Federal Regulations
CSI--Container Security Initiative
CSM--Container status message
C-TPAT--Customs-Trade Partnership Against Terrorism
DDP--Delivered duty paid
DDU--Delivered duty unpaid
DHS--U.S. Department of Homeland Security
EIN--Employer identification number
FAQ--Frequently asked questions

[[Page 91]]

FROB--Foreign cargo remaining on board
FTZ--Foreign trade zone
HTSUS--Harmonized Tariff Schedule of the United States
ICPA--International Compliance Professionals Association
IE--Immediate exportation
IIT--Instruments of international traffic
IMO--International Maritime Organization
IRS--Internal Revenue Service
ITDS--International Trade Data System
JIG--Joint Industry Group
MID--Manufacturer identification
MTSA--Maritime Transportation Security Act of 2002
NAM--National Association of Manufacturers
NCBFAA--National Customs Brokers and Forwarders Association of 
America
NVOCC--Non-vessel operating common carrier
OMB--Office of Management and Budget
Pub. L.--Public Law
RFA--Regulatory Flexibility Act of 1980
RILA--Retail Industry Leaders Association
SAFE Port Act--Security and Accountability for Every Port Act of 
2006
SBREFA--Small Business Regulatory Enforcement Fairness Act of 1996
SSN--Social security number
T&E--Transportation and exportation
TSN--Trade Support Network
UMRA--Unfunded Mandates Reform Act of 1995
UN EDIFACT--United Nations rules for Electronic Data Interchange For 
Administration, Commerce and Transport
U.S.C.--United States Code
WCO--World Customs Organization
WSC--World Shipping Council

I. Public Participation

    Interested persons are invited to participate in this rulemaking by 
submitting written data, views, or arguments on all aspects of the 
notice of proposed rulemaking. The Department of Homeland Security 
(DHS) also invites comments that relate to the economic, environmental, 
or federalism effects that might result from this proposal. Comments 
that will provide the most assistance to the Department in developing 
these procedures will reference a specific portion of the proposal, 
explain the reason for any recommended change, and include data, 
information, or authority that support such recommended change.

II. Background

A. Current Requirements and CBP Authority for Issuance of Proposed Rule

1. 24 Hour Rule
    Section 1431 of title 19, United States Code (19 U.S.C. 1431) 
requires that every vessel bound for the United States and required to 
make entry under 19 U.S.C. 1434 have a manifest that meets the 
requirements that are prescribed by regulation. Pursuant to 19 U.S.C. 
1431, Customs and Border Protection (CBP) published a final rule in the 
Federal Register (67 FR 66318) on October 31, 2002, which amended the 
regulations in title 19, Code of Federal Regulations (CFR), to require, 
among other things, the advance and accurate presentation of certain 
manifest information 24 hours prior to lading of containerized and non-
exempt break bulk cargo at a foreign port and to encourage the 
presentation of this information electronically, commonly known as the 
24 Hour Rule. The advance information required pursuant to the October 
31, 2002, final rule is required in order to enable CBP to evaluate the 
potential risk of smuggling weapons of mass destruction through the use 
of oceangoing cargo containers before goods are loaded on vessels 
destined to the United States. This advance information ensures 
compliance with U.S. law and enables CBP to facilitate the prompt 
release of legitimate cargo following its arrival in the United States. 
The information assists CBP in increasing the security of the global 
trading system and, thereby, reducing potential threats to the United 
States and world economy.
2. Trade Act Regulations
    Pursuant to section 343(a) of the Trade Act of 2002 (19 U.S.C. 2071 
note), as amended by section 108 of the Maritime Transportation 
Security Act of 2002 (Pub. L. 107-295, 116 Stat. 2064), CBP published a 
final rule in the Federal Register (68 FR 68140) on December 5, 2003, 
which, among other things, amended the 24 Hour Rule regulations to 
require the transmission of this information by way of the CBP Vessel 
Automated Manifest System (AMS). See 19 CFR 4.7 and 4.7a. The advance 
electronic transmission of cargo information required was determined to 
be reasonably necessary for CBP to identify high-risk shipments to 
prevent smuggling and ensure cargo safety and security.
3. SAFE Port Act
    On October 13, 2006, the President signed into law the Security and 
Accountability for Every Port Act of 2006 (Pub. L. 109-347, 120 Stat 
1884) (SAFE Port Act). Pursuant to Section 203 of the SAFE Port Act (6 
U.S.C. 943), the Secretary of Homeland Security, acting through the 
Commissioner of CBP must promulgate regulations to require the 
electronic transmission of additional data elements for improved high-
risk targeting, including appropriate security elements of entry data 
for cargo destined to the United States by vessel prior to loading of 
such cargo on vessels at foreign seaports. This NPRM proposes to 
require the electronic transmission of additional data for improved 
high-risk targeting.\1\ Some of these data elements would be required 
from carriers and others would be required from ``importers,'' as that 
term is defined for purposes of these regulations.
---------------------------------------------------------------------------

    \1\ Information on cargo feeds into CBP's Automated Targeting 
System (ATS) and is run against the system's protocols to evaluate 
all cargo shipments headed to the United States. ATS uses algorithms 
and anomaly analysis to identify high-risk targets. The system 
screens 100 percent of all cargo shipments. Using risk management 
principles and strategic intelligence, analysts use the system to 
identify shipments that pose a potential terrorist threat. One 
hundred percent of all high-risk shipments are inspected on arrival 
at ports of entry in the United States or in Container Security 
Initiative affiliated ports overseas.
---------------------------------------------------------------------------

    Prior to enactment of the SAFE Port Act, CBP had already undertaken 
an internal review of its targeting and inspection processes. 
Consequently, CBP had implemented a comprehensive strategy designed to 
enhance national security while protecting the economic vitality of the 
United States. The Container Security Initiative (CSI), the 24 Hour 
Rule, and the Customs-Trade Partnership Against Terrorism (C-TPAT) are 
cornerstone approaches implemented to further this goal. Additionally, 
CBP has developed cargo risk assessment capabilities in its Automated 
Targeting System (ATS) to screen all maritime containers before they 
are loaded aboard vessels in foreign ports. Each of these initiatives 
is dependent upon data supplied by trade entities, including carriers, 
non-vessel operating common carriers (NVOCCs), brokers, importers or 
their agents.
    The information that CBP currently analyzes to generate its risk 
assessment prior to vessel loading contains the same data elements that 
were originally established by the 24 Hour Rule. For the most part, 
this is the ocean carrier's or NVOCC's cargo declaration. While this 
was a sound initial approach to take after the tragic events of 
September 11th, internal and external government reviews have concluded 
that more complete advance shipment data would produce even more 
effective and more vigorous cargo risk assessments.
    In late 2004, the Departmental Advisory Committee on Commercial 
Operations of Customs and Border Protection and Related Homeland 
Security Functions (COAC) forwarded to the Department of Homeland 
Security and CBP one of its subcommittees' recommendations, which 
provided that: ``For ATS to provide enhanced security screening, the 
system should acquire additional shipment data to be used in the pre-
vessel loading security screening

[[Page 92]]

process.'' COAC recommended that CBP undertake a thorough review of the 
data element recommendations with the Trade Support Network (TSN) to 
determine what data elements the government required to improve the 
agency's risk assessment and targeting capabilities.
    Accordingly, CBP undertook further internal review and analysis of 
its targeting and inspection processes and worked with the TSN on this 
issue. Based upon its analysis, as well as the requirements under the 
SAFE Port Act, CBP is proposing to require the electronic transmission 
of additional data for improved high-risk targeting.

B. Statutory Factors Governing Development of Regulations

    Pursuant to section 203(d) of the SAFE Port Act, DHS is required to 
adhere to the parameters applicable to the development of regulations 
under section 343(a) of the Trade Act of 2002, including provisions 
relating to consultation, technology, analysis, use of information, 
confidentiality, and timing requirements.
    Under section 343(a) of the Trade Act of 2002, as amended, the 
requirement to provide information to CBP is generally to be imposed 
upon the party likely to have direct knowledge of the required 
information. However, where doing so is not practicable, CBP in the 
proposed regulations must take into account how the party on whom the 
requirement is imposed acquires the necessary information under 
ordinary commercial practices, and whether and how this party is able 
to verify the information it has acquired. Where the party is not 
reasonably able to verify the information, the proposed regulations 
must allow the party to submit the information on the basis of what it 
reasonably believes to be true.
    Furthermore, in developing the regulations, CBP, as required, has 
taken into consideration the remaining parameters set forth in the 
statute, where applicable, including:

--The existence of competitive relationships among parties upon which 
the information collection requirements are imposed;
--Different commercial practices and operational characteristics, and 
the technological capacity to collect and transmit information 
electronically;
--The need for interim requirements to reflect the technology that is 
available at the time of promulgation of the regulations for purposes 
of the parties transmitting, and CBP receiving and analyzing, 
electronic information in a timely fashion;
--That the use of the additional information collected pursuant to 
these regulations is to be only for ensuring cargo safety and security 
and preventing smuggling and not for determining merchandise entry or 
for any other commercial enforcement purposes;
--The protection of the privacy of business proprietary and any other 
confidential cargo information that CBP receives under these 
regulations, with the exception that a limited portion of certain 
manifest information may be required to be made available for public 
disclosure pursuant to 19 U.S.C. 1431(c);
--Balancing the impact on the flow of commerce with the impact on cargo 
safety and security in determining the timing for transmittal of 
required information;
--Where practicable, avoiding requirements in the regulations that are 
redundant with one another or with requirements under other provisions 
of law; and
--The need, where appropriate, for different transition periods for 
different classes of affected parties to comply with the electronic 
filing requirements in the regulations.

    Additionally, the statute requires that a broad range of parties, 
including importers, exporters, carriers, customs brokers, and freight 
forwarders, among other interested parties likely to be affected by the 
regulations, be consulted and their comments obtained and evaluated as 
a prelude to the development and promulgation of the regulations. In 
furtherance of this requirement, CBP met with COAC and other industry 
groups, including the American Association of Exporters and Importers 
(AAEI), the American Association of Port Authorities (AAPA), the Joint 
Industry Group (JIG), the National Association of Manufacturers (NAM), 
the National Customs Brokers and Forwarders Association of America 
(NCBFAA), the International Compliance Professionals Association 
(ICPA), the Retail Industry Leaders Association (RILA), the TSN, the 
U.S. Chamber of Commerce, and the World Shipping Council (WSC). In 
meetings and during conference calls, members of the importing and 
exporting community made many significant observations, insights, and 
suggestions as to what CBP should consider and how CBP should proceed 
in composing the proposed regulations. CBP presented to these groups a 
document entitled ``CBP Proposal for Advance Trade Data Elements'' (the 
``10+2 Strawman''). CBP also posted the 10+2 Strawman on the CBP Web 
site along with a request for comments from the public. The Strawman 
was known as 10+2 because ten of the elements are to come from 
importers, as defined in these regulations, describing the cargo, and 
two of the elements are to come from carriers including information 
regarding the containers and conveyances in which the cargo is loaded.
    Numerous commenters responded to the 10+2 Strawman. At CBP's 
request, the COAC Advance Data Subcommittee also prepared and presented 
recommendations to CBP. Indeed, input and recommendations from those 
members of the trade who participated in the meetings discussed above, 
the various workgroups of the COAC subcommittee, as well as the views 
expressed in the many e-mail submissions on this matter, were 
considered in the development of these proposed regulations.
    In this document, CBP responds to comments that were received in 
response to the 10+2 Strawman and the recommendation of the COAC 
Advance Data Subcommittee. General comments and responses are presented 
in Section III of this document. Comments relating to specific aspects 
of the proposal are presented in the section of this document that 
discusses CBP's proposal relating to that particular aspect.

C. Carrier and Importer Requirements Presented Separately

    Under the proposed regulations, carriers would be generally 
required to submit a vessel stow plan and container status messages 
regarding certain events relating to containers loaded on vessels 
destined to the United States (the ``2'' of ``10+2''). Importers, as 
defined in these regulations, would be required to submit an Importer 
Security Filing containing certain data elements (the ``10'' of 
``10+2''). For purposes of the proposed regulations, importer means the 
party causing goods to arrive within the limits of a port in the United 
States. For foreign cargo remaining on board (FROB), the importer is 
construed as the carrier. For immediate exportation (IE) and 
transportation and exportation (T&E) in-bond shipments, and goods to be 
delivered to a foreign trade zone (FTZ), the importer is construed as 
the party filing the IE, T&E, or FTZ documentation with CBP. Because 
the proposed requirements for carriers and importers are different in 
scope and timing, they are presented separately below.

[[Page 93]]

III. Proposed Carrier Requirements Relating to Vessel Cargo Destined to 
the United States

A. Overview; Vessel Stow Plan

    Pursuant to the authority granted in section 343(a) of the Trade 
Act of 2002, as amended by the Maritime Transportation Security Act of 
2002 (MTSA), CBP is proposing to require carriers to submit a vessel 
stow plan for vessels destined to the United States. The vessel stow 
plan is used to transmit information about the physical location of 
cargo loaded aboard a vessel, which enhances the security of the 
maritime environment. Under the proposed regulations, CBP must receive 
the stow plan for vessels transporting containers and/or break bulk 
cargo no later than 48 hours after departure from the last foreign 
port. For voyages less than 48 hours in duration, CBP must receive the 
stow plan prior to the vessel's arrival at the first port in the United 
States. Bulk carriers would be exempt from this requirement for vessels 
exclusively carrying bulk cargo. The vessel stow plan must be submitted 
via the CBP-approved electronic data interchange system. The current 
approved electronic data interchange system for the vessel stow plan is 
vessel AMS. If CBP approves of different or additional electronic data 
interchange systems, CBP will publish a notice in the Federal Register.
    Under the proposed regulations, the vessel stow plan must include 
standard information relating to the vessel and each container and unit 
of break bulk cargo laden on the vessel. The vessel stow plan must 
include the following standard information: With regard to the vessel,
    (1) Vessel name (including international maritime organization 
(IMO) number);
    (2) Vessel operator; and
    (3) Voyage number.
    With regard to each container or unit of break bulk cargo,
    (1) Container operator, if containerized;
    (2) Equipment number, if containerized;
    (3) Equipment size and type, if containerized;
    (4) Stow position;
    (5) Hazmat-UN code;
    (6) Port of lading; and
    (7) Port of discharge.

B. Overview; Container Status Messages

    Pursuant to section 343(a) of the Trade Act of 2002, CBP is 
proposing to require carriers to submit container status messages 
(CSMs) daily for certain events relating to all containers laden with 
cargo destined to arrive within the limits of a port in the United 
States by vessel. Container status messages serve to facilitate the 
intermodal handling of containers by streamlining the information 
exchange between trading partners involved in administration, commerce, 
and transport of containerized shipments.
    Container status messages will provide CBP with additional 
transparency into the custodial environment through which inter-modal 
containers are handled and transported before arrival in the United 
States. This enhanced view (in corroboration with other advance data 
messages) into the international supply chain will contribute to the 
security of the United States and in the international supply chain 
through which containers and import cargos reach ports in the United 
States.
    The messages are used to report terminal container movements (e.g., 
loading and discharging the vessel) and to report the change in status 
of containers (e.g., empty or full). There are two basic standards 
governing the formation of CSMs. These are the American National 
Standards Institute (ANSI) X.12 standard and the United Nations rules 
for Electronic Data Interchange For Administration, Commerce and 
Transport (UN EDIFACT) standard. Under the proposed regulations, CSMs 
created under either standard will be acceptable.
    Under the proposed regulations, carriers must submit a CSM when any 
of the required events occurs if the carrier creates or collects a CSM 
in its equipment tracking system reporting that event. The proposed 
regulations would not require a carrier create or collect any CSM data 
other than that which the carrier already creates or collects on its 
own and maintains in its electronic equipment tracking system. CSMs 
must be submitted no later than 24 hours after the message is entered 
into the carrier's equipment tracking system.
    The events for which CSMs would be required are:
    (1) When the booking relating to a container which is destined to 
arrive within the limits of a port in the United States by vessel is 
confirmed;
    (2) When a container which is destined to arrive within the limits 
of a port in the United States by vessel undergoes a terminal gate 
inspection;
    (3) When a container, which is destined to arrive within the limits 
of a port in the United States by vessel, arrives or departs a facility 
(These events take place when a container enters or exits a port, 
container yard, or other facility. Generally, these CSMs are referred 
to as ``gate-in'' and ``gate-out'' messages.);
    (4) When a container, which is destined to arrive within the limits 
of a port in the United States by vessel, is loaded on or unloaded from 
a conveyance (This includes vessel, feeder vessel, barge, rail and 
truck movements. Generally, these CSMs are referred to as ``loaded on'' 
and ``unloaded from'' messages);
    (5) When a vessel transporting a container, which is destined to 
arrive within the limits of a port in the United States by vessel, 
departs from or arrives at a port (These events are commonly referred 
to as ``vessel departure'' and ``vessel arrival'' notices);
    (6) When a container which is destined to arrive within the limits 
of a port in the United States by vessel undergoes an intra-terminal 
movement;
    (7) When a container which is destined to arrive within the limits 
of a port in the United States by vessel is ordered stuffed or 
stripped;
    (8) When a container which is destined to arrive within the limits 
of a port in the United States by vessel is confirmed stuffed or 
stripped; and
    (9) When a container which is destined to arrive within the limits 
of a port in the United States by vessel is shopped for heavy repair.
    CBP is aware that it may be cost beneficial for some carriers to 
transmit all CSMs, rather than filter out CSMs relating to containers 
destined to the United States or relating only to the required events. 
Accordingly, CBP is proposing to allow carriers to transmit their 
``global'' CSM messages, including CSMs relating to containers that do 
not contain cargo destined for importation into the United States and 
CSMs relating to events other than the required events. By transmitting 
CSMs in addition to those required by the proposed regulations, a 
carrier authorizes CBP to access and use that data.
    For each CSM submitted, the following information must be included:
    (1) Event code being reported, as defined in the ANSI X.12 or UN 
EDIFACT standards;
    (2) Container number;
    (3) Date and time of the event being reported;
    (4) Status of the container (empty or full);
    (5) Location where the event took place; and
    (6) Vessel identification associated with the message.
    Carriers would be exempt from the CSM requirement for bulk and 
break

[[Page 94]]

bulk cargo. Under the proposed regulations, CSMs must be submitted via 
the CBP-approved electronic data interchange system. The current 
approved electronic data interchange system for CSMs is vessel AMS. CBP 
is continuing to consider additional electronic interchange systems. If 
CBP approves of a different or additional electronic data interchange 
system, CBP will publish notice in the Federal Register.

IV. Proposed Importer Requirements for Vessel Cargo Destined to the 
United States

A. Overview; Required Elements

    Pursuant to the authority of section 343(a) of the Trade Act of 
2002 and section 203 of the SAFE Port Act, in order to enhance the 
security of the maritime environment, CBP is proposing to require 
importers, as defined in these regulations, or their agents, to 
transmit an Importer Security Filing to CBP, for cargo other than 
foreign cargo remaining on board (FROB), no later than 24 hours before 
cargo is laden aboard a vessel destined to the United States. Because 
FROB is frequently laden based on a last-minute decision by the 
carrier, the Importer Security Filing for FROB would not be required 24 
hours prior to lading. Rather, the Importer Security Filing for FROB 
would be required any time prior to lading.\2\
---------------------------------------------------------------------------

    \2\ CBP is not proposing to amend the timing requirements in 19 
CFR part 4 requiring submission of advance manifest information 24 
hours prior to lading.
---------------------------------------------------------------------------

    Under the proposed regulations, 10 elements are required for 
shipments consisting of goods intended to be entered into the United 
States and goods intended to be delivered to a foreign trade zone 
(FTZ). For goods to be delivered to an FTZ, the importer is construed 
as the party filing the FTZ documentation with CBP. These 10 elements 
must be transmitted by the importer, as defined in these regulations, 
or its agent. Five elements are required for shipments consisting 
entirely of FROB and shipments consisting entirely of goods intended to 
be ``transported'' as immediate exportation (IE) or transportation and 
exportation (T&E) in-bond shipments.
    For FROB, the importer is construed as the international carrier of 
the vessel arriving in the United States. For IE and T&E in-bond 
shipments, the importer is construed as the party filing the IE or T&E 
documentation with CBP.
1. Shipments Other Than FROB, IE Shipments, and T&E Shipments
    Under the proposed regulations, for the Importer Security Filing 
for shipments other than those consisting entirely of FROB and goods 
intended to be ``transported'' in-bond as an IE or T&E, 10 elements 
must be provided, unless specifically exempted. The manufacturer (or 
supplier) name and address, country of origin, and commodity HTSUS 
number must be linked to one another at the line item level.
    The ten required elements are:
    (1) Manufacturer (or supplier) name and address. Name and address 
of the entity that last manufactures, assembles, produces, or grows the 
commodity or name and address of the supplier of the finished goods in 
the country from which the goods are leaving. In the alternative, the 
name and address of the manufacturer (or supplier) that is currently 
required by the import laws, rules and regulations of the United States 
(i.e., entry procedures) may be provided (this is the information that 
is used to create the existing manufacturer identification (MID) number 
for entry purposes).
    (2) Seller name and address. Name and address of the last known 
entity by whom the goods are sold or agreed to be sold. If the goods 
are to be imported otherwise than in pursuance of a purchase, the name 
and address of the owner of the goods must be provided.\3\
---------------------------------------------------------------------------

    \3\ The party required for this element is consistent with the 
information required on the invoice of imported merchandise. See 19 
CFR 141.86(a)(2).
---------------------------------------------------------------------------

    (3) Buyer name and address. Name and address of the last known 
entity to whom the goods are sold or agreed to be sold. If the goods 
are to be imported otherwise than in pursuance of a purchase, the name 
and address of the owner of the goods must be provided.\4\
---------------------------------------------------------------------------

    \4\ The party required for this element is consistent with the 
information required on the invoice of imported merchandise. See 19 
CFR 141.86(a)(2).
---------------------------------------------------------------------------

    (4) Ship to name and address. Name and address of the first 
deliver-to party scheduled to physically receive the goods after the 
goods have been released from customs custody.
    (5) Container stuffing location. Name and address(es) of the 
physical location(s) where the goods were stuffed into the container. 
For break bulk shipments, the name and address(es) of the physical 
location(s) where the goods were made ``ship ready'' must be provided.
    (6) Consolidator (stuffer) name and address. Name and address of 
the party who stuffed the container or arranged for the stuffing of the 
container. For break bulk shipments, the name and address of the party 
who made the goods ``ship ready'' or the party who arranged for the 
goods to be made ``ship ready'' must be provided.
    (7) Importer of record number / FTZ applicant identification 
number. Internal Revenue Service (IRS) number, Employer Identification 
Number (EIN), Social Security Number (SSN), or CBP assigned number of 
the entity liable for payment of all duties and responsible for meeting 
all statutory and regulatory requirements incurred as a result of 
importation. For goods intended to be delivered to an FTZ, the IRS 
number, EIN, SSN, or CBP assigned number of the party filing the FTZ 
documentation with CBP must be provided. The importer of record number 
for Importer Security Filing purposes is the same as ``importer 
number'' on CBP Form 3461.
    (8) Consignee number(s). Internal Revenue Service (IRS) number, 
Employer Identification Number (EIN), Social Security Number (SSN), or 
CBP assigned number of the individual(s) or firm(s) in the United 
States on whose account the merchandise is shipped. This element is the 
same as the ``consignee number'' on CBP Form 3461.
    (9) Country of origin. Country of manufacture, production, or 
growth of the article, based upon the import laws, rules and 
regulations of the United States. This element is the same as the 
``country of origin'' on CBP Form 3461.
    (10) Commodity HTSUS number. Duty/statistical reporting number 
under which the article is classified in the Harmonized Tariff Schedule 
of the United States (HTSUS). The HTSUS number is required to be 
provided to the 6 digit level. The HTSUS number may be provided up to 
the 10 digit level. This element is the same as the ``H.S. number'' on 
CBP Form 3461 and can only be used for entry purposes, if it is 
provided at the 10 digit level or greater.
2. FROB, IE Shipments, and T&E Shipments
    Under the proposed regulations, for the Importer Security Filing 
for shipments consisting entirely of FROB and shipments consisting 
entirely of goods intended to be ``transported'' in-bond as an IE or 
T&E, five elements must be provided in order to enhance the security of 
the maritime environment.
    The five required elements are:
    (1) Booking party name and address. Name and address of the party 
who is paying for the transportation of the goods.
    (2) Foreign port of unlading. Port code for the foreign port of 
unlading at the intended final destination.

[[Page 95]]

    (3) Place of delivery. City code for the place of delivery.
    (4) Ship to name and address. Name and address of the first 
deliver-to party scheduled to physically receive the goods after the 
goods have been released from customs custody.
    (5) Commodity HTSUS number. Duty/statistical reporting number under 
which the article is classified in the Harmonized Tariff Schedule of 
the United States (HTSUS). The HTSUS number must be provided to the 6 
digit level. The HTSUS number is required to be provided up to the 10 
digit level.

B. Public Comments; Required Elements

Comment
    The Importer Security Filing should be based on the best 
information available at the time of filing. CBP, in consultation with 
the trade, should develop a process to amend a filing prior to arrival. 
An entry (CBP Form 3461, 7501 or 214) filed prior to arrival should be 
accepted as the amendment, except to change the name and address of the 
consolidator and/or place of container stuffing. CBP should issue 
frequently asked questions (FAQs) clarifying when an amendment is 
required or recommended.
CBP Response
    Pursuant to existing 19 CFR 4.7(b)(3)(iii) and proposed 19 CFR 
149.2(c), CBP will take into consideration how, in accordance with 
ordinary commercial practices, the presenting party acquired Importer 
Security Filing information and whether and how the presenting party is 
able to verify this information. Where the presenting party is not 
reasonably able to verify such information, CBP will permit the party 
to electronically present the information on the basis of what the 
party reasonably believes to be true.
    Under the proposed regulations the party who filed the Importer 
Security Filing is required to update the Importer Security Filing if, 
after the filing and before the goods enter the limits of a port in the 
United States, there are changes to the information filed.
    Permission to divert T&E and IE shipments would be required. Such 
permission would only be granted upon receipt by CBP of a complete 
Importer Security Filing.
    Finally, in order to maintain the integrity of the differences 
between the Importer Security Filing and commercial documents and to 
facilitate compliance with the Trade Act requirement not to use 
security information for trade compliance purposes, CBP will not accept 
CBP Forms 3461, 7501, or 214 in lieu of an amendment to an Importer 
Security Filing.
Comment
    CBP needs to provide instruction to the trade as to how to handle 
those situations where despite due diligence, all of the necessary data 
elements are simply not available 24 hours prior to loading. For 
example, importers may not know the container stuffing location, 
consolidator name and address, country of origin, and 6 digit HTSUS 
number 24 hours prior to lading.
CBP Response
    CBP understands that, in some cases, business practices may have to 
be altered to obtain the required information in a timely fashion. CBP, 
however, will provide guidance in the form of FAQs, postings on the CBP 
website, and other outreach to the trade.
    If an importer, as defined in these regulations, does not know an 
element that is required pursuant to the proposed regulations, the 
importer must take steps necessary to obtain the information. For 
example, the 6 digit HTSUS number is sometimes provided by members of 
the trade community on T&E and IE in-bond movements. Under the proposed 
rulemaking, CBP would allow importers to submit the HTSUS number at the 
6 digit level. CBP recognizes that, for most importers, this 
information is known well before the placement of the order for their 
goods because of the need to determine duty cost and admissibility 
status prior to finalizing the purchase contract or shipment contract.
Comment
    Tier 3 C-TPAT members should be exempt from the Importer Security 
Filing requirement or, in the alternative, should be required to submit 
fewer than all of the required Importer Security Filing elements. Tier 
3 C-TPAT supply chains have already been vetted by CBP. Why does CBP 
intend to repeat its risk assessment on each individual shipment?
CBP Response
    CBP will use the Importer Security Filing to assess the risk of 
individual shipments. For purposes of this rulemaking, all cargo 
arriving to the United States by vessel, regardless of the parties 
involved, would be subject to the Importer Security Filing 
requirements. CBP is not proposing to allow exemption from, or 
alteration of, the requirement that C-TPAT partners submit Importer 
Security Filing information in advance of arrival. CBP believes that 
compliance with these regulations complements supply chain security and 
efficiency procedures being implemented by C-TPAT partners. 
Furthermore, it is emphasized that C-TPAT membership will continue to 
be viewed in a positive light for targeting purposes. It is more likely 
that shipments made by C-TPAT members will be readily and expeditiously 
cleared, and not be delayed for greater CBP scrutiny. Other related 
perquisites of C-TPAT partnership may include essential security 
benefits for suppliers, employees, and customers, such as a reduction 
in the number and extent of border inspections and eligibility for 
account-based processes.
Comment
    The Importer Security Filing should be done by a single party; 
however that party should be permitted to rely on information from more 
than one source for the purpose of preparing the filing. CBP and the 
trade should remain open to proposals for any viable means by which a 
single Importer Security Filing could be done by more than one party.
CBP Response
    Under the proposed regulations, the importer, as defined in these 
regulations, is ultimately responsible for the timely, accurate, and 
complete submission of the Importer Security Filing. CBP is proposing 
to require that one party aggregate and submit all required elements. 
In response to requests from the trade, CBP is proposing to allow 
importers to designate an agent to submit the filing on behalf of the 
importer. While CBP understands that some business practices may need 
to be altered to obtain the required information at an earlier point, 
CBP does not anticipate that these changes will be unduly burdensome.
Comment
    CBP's current layered targeting approach, along with the additional 
Importer Security Filing data elements, such as container stuffing and 
consolidator data, provide CBP with the needed information with which 
to determine the last country of manufacture, production, assembly or 
shipping. Therefore, the current regulatory definition of country of 
origin as articulated by existing CBP regulations and free trade 
agreements should remain an option for satisfying the Importer Security 
Filing definition of country of origin.

[[Page 96]]

CBP Response
    CBP agrees. Under the proposed regulations, the country of origin 
is required to be provided for all goods that have been listed at least 
at the 6 digit HTSUS level. The proposed definition for this element is 
consistent with the country of origin as required on CBP Form 3461.
Comment
    The security filing should require an HTSUS number at only the 6 
digit level; however the system used for filing should be capable of 
accepting up to a 10 digit HTSUS number.
CBP Response
    CBP agrees. Under the proposed regulations, the importer, as 
defined in these regulations, is required to provide the HTSUS number 
24 hours prior to lading at the HTSUS number at the 6 digit level. 
However, importers may submit the HTSUS number up to the 10 digit level 
(they must use the 10 digit level if they plan to use the Importer 
Security Filing as part of an entry filing).
Comment
    There should be no mandatory linking of the HTSUS number to the 
country of origin and manufacturer (or supplier) name and address data 
elements. If this linking is proposed by CBP in its NPRM, the agency 
must first ensure this specific topic is addressed in a separate cost/
benefit analysis, with the participation of the trade, and the results 
separately reported, because the linking would potentially impose a 
significant cost burden on the trade both from a programming 
perspective and a service provider fee perspective. The data in 
question is also generally not provided at the line item level to 
foreign entities such as freight forwarders.
CBP Response
    CBP disagrees. Under the proposed regulations, the manufacturer (or 
supplier) name and address, country of origin, and commodity HTSUS 
number elements must be linked to one another at the line item level. 
CBP has considered the economic impacts of this proposed rule in its 
cost, benefit, and feasibility study. A summary of this analysis is 
presented below, and the complete analysis can be found on the CBP 
website and the public docket for this rulemaking (see 
www.regulations.gov). Regarding the potential burden, the data is 
already provided to CBP at the line item level for entry and entry 
summary purposes. If an importer, as defined in these regulations, 
chooses to use a foreign freight forwarder as an agent for Importer 
Security Filing purposes, the importer will need to provide this data 
to that party at the line item level.
Comment
    The CBP proposal and data elements must include a bill of lading 
number.
CBP Response
    The bill of lading number is necessary to link the carrier's 
submissions with the Importer Security Filing submission. Under the 24 
Hour Rule, the carrier is required to provide the bill of lading number 
24 hours prior to lading. Therefore, the importer, as defined in these 
regulations, or its authorized agent would be required to submit the 
bill of lading number when the importer elements are submitted.
Comment
    The Importer Security Filing data elements and definitions should 
align with those of the World Customs Organization (WCO) SAFE 
Framework.
CBP Response
    CBP agrees. CBP is working with the WCO to develop an amendment 
process that will enable the WCO Framework of Standards to adapt to 
changes in the international security environment. In addition, CBP 
will seek to make data elements consistent with (or have data elements 
included in) the WCO Data Model. CBP is concerned with ensuring that, 
to the maximum extent possible, the data elements and definitions 
required under the proposed Importer Security Filing regulations are 
consistent with the data elements and their meaning as currently 
required of importers under the commercial entry procedures.
Comment
    The Importer Security Filing data elements and definitions should 
align with the ISO UNTEDE 2005 7372:2005 definitions and the Automated 
Commercial Environment (ACE)/International Trade Data System (ITDS) 
definitions.
CBP Response
    CBP has considered, and will continue to consider, ISO definitions 
and the ITDS requirements during the development of the Security Filing 
initiative. As discussed in response to a comment above, CBP is 
preliminarily concerned with ensuring that, to the maximum extent 
possible, the data elements and definitions required under the proposed 
Importer Security Filing regulations are consistent with the data 
elements and their meaning as currently required of importers under the 
commercial entry procedures.
Comment
    Where possible the name and address of the actual manufacturer 
should be required. Where this is not known or the shipment consists of 
commingled articles, filers should indicate the name and address of the 
supplier in their security filing.
CBP Response
    CBP agrees. Based on input from the trade, CBP is proposing to 
require the importer, as defined in these regulations, or his 
authorized agent, to provide the name and address of either the 
manufacturer or supplier of the finished goods in the country from 
which the goods are leaving.
Comment
    The manufacturer identification (MID) number, as defined in CBP 
directives, should be accepted in lieu of the manufacturer (or 
supplier) name and address.
CBP Response
    CBP disagrees. In general, the MID does not include the complete 
address of the manufacturer. CBP believes that the complete 
manufacturer's name and address (sometimes supplier in the country from 
which the goods are leaving in lieu of manufacturer) is a critical 
piece of information to effectively target high risk cargo. CBP 
believes that this information is readily available to importers 
because this is the underlying information necessary for creating the 
MID which is required for filing entry. The trade already has access to 
software that electronically converts the manufacturer's full name and 
address into the MID.
Comment
    CBP should more clearly define the term ``shipper'' as used in the 
data definitions.
CBP Response
    ``Shipper'' is not one of the data elements required under the 
proposed regulations, nor is it used in the definitions for the 
required elements.

C. Overview; Master Bills/House Bills

    Under the proposed regulations, an Importer Security Filing is 
required for each shipment, at the lowest bill of lading level (i.e., 
at the house bill of lading level, if applicable). Generally speaking, 
a master bill of lading refers to the bill of lading that is generated 
by the incoming carrier covering a consolidated shipment. A 
consolidated

[[Page 97]]

shipment would consist of a number of separate shipments that have been 
received and consolidated into one shipment by a party, such as a 
freight forwarder or a NVOCC for delivery as a single shipment to the 
incoming carrier. The consolidated shipment would be covered under the 
incoming carrier's master bill. However, each of the shipments thus 
consolidated would be covered by what is referred to as a house bill. 
It is information from the relevant house bill that CBP is seeking for 
targeting purposes.

D. Public Comments; Master Bills/House Bills

Comment
    When one shipment to one importer of record includes multiple bills 
of lading, only one security filing should be required. The multiple 
bills of lading should not be required to be identified at the line 
item level.
CBP Response
    CBP agrees. Under the proposed rule, one Importer Security Filing 
can satisfy multiple bills of lading. However, the manufacturer (or 
supplier) name and address, country of origin, and commodity HTSUS 
number elements must be linked to one another at the line item level.
Comment
    There should be capability for the Importer Security Filing to be 
done at the house bill of lading level with no reference to the master 
bill of lading.
CBP Response
    CBP disagrees with this comment. It is necessary for the filer to 
reference the master bill of lading number in the Importer Security 
Filing in order for the house bill and master bill to be linked at a 
later date.
Comment
    In the case of transshipped goods, the system programming should 
allow reporting at the house bill of lading level based upon the feeder 
vessel at time of loading, which can then be married to the arriving/
mother vessel through AMS filing by that arriving/mother vessel.
CBP Response
    CBP disagrees. Under the proposed rule, CBP is requiring that the 
Importer Security Filing be submitted at the lowest bill level, down to 
the house bill, and is requiring that the bill be the one under which 
the cargo is brought to the United States.
Comment
    CBP should establish account profiles for importers of repetitive 
shipments. These accounts could be based on the ACE account example or 
the BRASS (line release) example at the U.S.-Canada and U.S.-Mexico 
borders. A repetitive low-security risk importer would then give its 
account information, together with anything unique/different about the 
specific shipment, in lieu of the full security filing.
CBP Response
    CBP disagrees. CBP will use the Importer Security Filing to assess 
the risk of individual shipments. For purposes of this rulemaking, each 
and every shipment arriving to the United States by vessel would be 
subject to the Importer Security Filing requirements. As CBP continues 
to develop ACE, the agency will continue to make enhanced flexibility 
for the trade a top priority.

E. Overview; CBP-approved Electronic Interchange System

    Under the proposed regulations, importers, as defined in these 
regulations, or their agents, would be required to transmit the 
Importer Security Filing via a CBP-approved electronic data interchange 
system. The current approved electronic data interchange systems for 
the Importer Security Filing are the Automated Broker Interface (ABI) 
and the Vessel Automated Manifest System (AMS). If CBP approves a 
different or additional electronic data interchange system, CBP will 
publish notice in the Federal Register.

F. Public Comments; CBP-approved Electronic Interchange System

Comment
    CBP should delay the implementation of the regulations until they 
can be implemented through ACE.
CBP Response
    CBP disagrees. Pursuant to Section 203 of the SAFE Port Act, the 
Secretary of Homeland Security is required to promulgate regulations 
requiring additional data elements for improved high-risk targeting. 
After careful consideration, DHS has determined that immediate action 
is necessary to increase the security of containers entering the United 
States by vessel by improving CBP's risk assessment capabilities. CBP 
will take into account systems changes made by the trade to comply with 
this proposed rulemaking as ACE is developed.
Comment
    Current access requirements to CBP systems need to be changed. CBP 
must eliminate the requirement that ABI filers have custom house broker 
licenses or be self-filers.
CBP Response
    Pursuant to 19 CFR 143.1, importers, brokers, and ABI service 
bureaus are permitted to participate in ABI. In addition, other parties 
currently access ABI to transmit protests, forms relating to in-bond 
movements (CBP Form 7512), and applications for FTZ admission (CBP Form 
214). CBP is proposing to amend 19 CFR 143.1 to clarify that importers, 
brokers, and, if they do not participate in ``customs business,'' ABI 
service bureaus are permitted to participate in ABI for entry purposes. 
In addition, upon approval by CBP, any party may gain access to ABI for 
other purposes, including transmission of protests, forms relating to 
in-bond movements (CBP Form 7512), and applications for FTZ admission 
(CBP Form 214). In addition, CBP is proposing to amend 19 CFR 143.1 to 
permit any Importer Security Filing filer to gain access to ABI for the 
purpose of transmitting the Importer Security Filing if that party 
obtains a bond.
Comment
    Flexibility of who may send the Importer Security Filing should be 
enhanced by allowing other formats and interfaces in addition to ABI 
and AMS.
CBP Response
    CBP disagrees. As stated above, filing of the data elements through 
ABI and AMS is not limited to licensed customs brokers or importers 
filing their own submissions (ABI) or bonded carriers (AMS). CBP will 
continue to make enhanced flexibility for the trade a top priority as 
ACE is developed and is continuing to look at additional electronic 
interchange systems for transmission of CSMs.
Comment
    CBP should transmit a confirmation or acceptance message confirming 
that the Importer Security Filing has been successfully filed. The 
acceptance message is not expected to validate the data transmitted, 
simply to confirm that it has been received in the required format.
    In addition, query functionality should be designed into the system 
to provide the importer of record or its authorized agent visibility as 
to whether an Importer Security Filing has been made for a specific 
shipment. At the

[[Page 98]]

same time, the system should be designed so that importers have full 
visibility, meaning they are able to read the actual data elements as 
filed and also who made the filing.
CBP Response
    CBP agrees in part. CBP will provide, to the filer, electronic 
acknowledgement that the filer's submission has been received according 
to ABI and AMS standards. However, ABI and AMS filers will not have the 
ability to query whether an Importer Security Filing is complete, the 
actual data elements, or the identity of the party who filed the 
elements. CBP believes that communication between importers, as defined 
in these regulations, and their designated agents will be sufficient to 
inform the importer regarding the completeness and contents of a 
filing.

G. Overview; Authorized Agents

    CBP is proposing to allow an importer, as defined in these 
regulations, as a business decision, to designate an authorized agent 
to file the Importer Security Filing on the importer's behalf. Under 
the proposed regulations, a party can act as an authorized agent for 
purposes of filing the Importer Security Filing if that party obtains 
access to ABI or AMS and obtains a bond.

H. Public Comments; Authorized Agents

Comment
    It is unfair to hold the importer liable for data filed by a 
foreign party, such as a foreign freight forwarder. The foreign filing 
party may make typographic errors for which the importer may be liable. 
The importer may not have any method of even checking the advance trade 
data that has been filed.
CBP Response
    In response to requests from the trade, CBP is proposing to allow 
an importer, as defined in these regulations, to use an agent of the 
importer's choosing to submit the Importer Security Filing. CBP is not 
requiring the use of an agent. The importer is ultimately responsible 
for the timely, accurate, and complete submission of the Importer 
Security Filing.
Comment
    Foreign freight forwarders need to be allowed to file the Importer 
Security Filing. The final rule needs to state that filing the Importer 
Security Filing does not constitute ``customs business.''
CBP Response
    The Importer Security Filing would be a filing for security 
purposes, not for any of the purposes identified under 19 U.S.C. 1641 
or 19 CFR part 111. As such, the transmission of the Importer Security 
Filing alone would not constitute ``customs business.'' As discussed 
below, if an importer chooses to have applicable elements of the 
Importer Security Filing used for entry purposes, the Importer Security 
Filing must be self-filed by the importer or filed by a licensed 
customs broker.

I. Public Comments; Requested Exemptions/Exclusions From Importer 
Security Filing Requirements

Comment
    The security filing process should be created in such a way as to 
allow the capability to designate that the security filing for a 
specific type of shipment involves a transaction for which all the 
required information cannot be provided at time of filing. Examples 
include, but are not limited to: carnets, direct duty paid (DDP)/direct 
duty unpaid (DDU) shipments, consigned goods, returned goods, and 
samples.
CBP Response
    CBP generally agrees. However, the examples provided by the 
commenter will not be automatically exempt from submitting the required 
importer elements. The proposed regulations require the importer, as 
defined in these regulations, or its authorized agent, to submit the 
importer elements of the Importer Security Filing. If an importer does 
not know an element that is required pursuant to the proposed 
regulations and CBP guidance, the importer must take steps necessary to 
obtain the information. If an importer believes that a required 
Importer Security Filing data element does not exist for a non-exempt 
transaction type, the importer should request a ruling from CBP prior 
to the time required for the Importer Security Filing. If the filing is 
for a shipment type that CBP has specifically designated exempt from an 
element or elements, CBP will allow the filer to designate the filing 
as one of several ``exemption'' types, including FROB and IE and T&E 
in-bond shipments. These ``exemptions'' are discussed more in-depth 
below. CBP will publish technical requirements regarding the input of 
data in ABI and AMS on the CBP Web site.

1. Bulk and Break Bulk Cargo

Comment
    How should bulk and break bulk shipments be handled?
CBP Response
    Under the proposed regulations, importers of bulk cargo are exempt 
from the proposed importer and carrier requirements for bulk goods when 
the goods are exempt from the requirement that the carrier file the 
cargo declaration 24 hours prior to loading.
    For Importer Security Filing purposes, CBP is proposing to model 
the treatment of approved break bulk cargo as per the Trade Act 
regulations in 19 CFR 4.7(b)(4). CBP is proposing to require an 
Importer Security Filing for break bulk shipments, when the goods are 
exempt from the requirement that the carrier file the cargo declaration 
24 hours prior to loading, 24 hours prior to arrival in the United 
States. For break bulk shipments, the name and address(es) of the 
physical location(s) where the goods were made ``ship ready'' must be 
provided for the container stuffing location element and the name and 
address of the party who arranged for the goods to be made ``ship 
ready'' must be provided for the consolidator (stuffer) name and 
address element.

2. Foreign Cargo Remaining on Board, IE and T&E In-bond Shipments, and 
Instruments of International Traffic

Comment
    Foreign cargo remaining on board (FROB), Immediate Exportation (IE) 
and Transportation and Exportation (T&E) in-bond shipments, and 
instruments of international traffic (IIT) (e.g., containers, racks, 
pallets) should be exempt from the Importer Security Filing requirement 
in the near term. The final regulations should define additional 
transactions exempt from the Importer Security Filing including types 
of transactions identified by CBP in consultation with the trade.
CBP Response
    CBP is not proposing to require an Importer Security Filing for 
IIT. However, CBP is proposing to require an Importer Security Filing 
for all other shipments arriving in the United States by vessel, 
including FROB and in-bond shipments, unless specifically exempted 
under the regulations. Under the proposed regulations, an Importer 
Security Filing is required for FROB, but because FROB is not destined 
to be received in the United States, the carrier would be required to 
submit the following data elements: booking party name and address, 
foreign port of unlading, place of delivery, ship to name and address, 
and commodity 6 digit HTSUS number.
    Under the proposed regulations, an Importer Security Filing is 
required for

[[Page 99]]

IE and T&E in-bond shipments. Because IE and T&E shipments are not 
destined to remain in the United States, CBP is proposing to require 
the party taking delivery in the United States to submit the following 
data elements: booking party name and address, foreign port of 
unlading, place of delivery, ship to name and address, and commodity 6 
digit HTSUS number.
    CBP is proposing to amend the regulations to require that, if at 
the time of submission of the Importer Security Filing, the goods are 
intended to be moved in-bond as an IE or T&E shipment, but later a 
decision is made to divert the goods, permission to divert the in-bond 
movement to a port other than the listed port of destination or export 
or to change the in-bond entry into a consumption entry must be 
obtained from the port director of the port in which the original in-
bond documents were filed. Such permission would only be granted upon 
receipt by CBP of a complete Importer Security Filing.

J. Overview; Updating an Importer Security Filing

    As discussed above, under the proposed regulations, the party who 
filed the Importer Security Filing is required to update the Importer 
Security Filing if, after the filing and before the goods arrive within 
the limits of a port in the United States, there are changes to the 
information filed or more accurate information becomes available.

K. Public Comments; Withdrawing an Importer Security Filing

Comment
    CBP should establish a procedure for cancellation of an Importer 
Security Filing for goods not shipped, changes in itineraries, etc.
CBP Response
    CBP agrees. The proposed regulations allow for the withdrawal of an 
Importer Security Filing when a shipment is no longer intended to 
arrive within the limits of a port in the United States.

L. Overview; Importer Security Filing, Entry, and Application for FTZ 
Admission

1. Importer Security Filing and Entry
    Four of the Importer Security Filing elements are identical to 
elements submitted for entry (CBP Form 3461) and entry summary (CBP 
Form 7501) purposes. These elements are the importer of record number, 
consignee number, country of origin, and commodity HTSUS number when 
provided at the 10 digit level. In an effort to minimize the redundancy 
of data transmitted to CBP, after further consideration and in response 
to public comments, CBP is proposing to allow an importer to submit 
these elements once to be used for both Importer Security Filing and 
entry/entry summary purposes. If an importer chooses to have these 
elements used for entry/entry summary purposes, the Importer Security 
Filing and entry/entry summary must be self-filed by the importer or 
filed by a licensed customs broker in a single transmission to CBP. In 
addition, the HTSUS number must be provided at the 10 digit level. 
Choosing this option does not relieve the requirement to submit all 
remaining Importer Security Filing elements (including the manufacturer 
(supplier) name and address) and entry and/or entry summary elements 
(including the manufacturer identification (MID) number).
    Under the proposed rule, an importer can choose to do the 
following: (1) Submit the Importer Security Filing and entry and/or 
entry summary data with no connection between them; or (2) Submit the 
entry and/or entry summary data via the same electronic transmission as 
the Importer Security Filing. If the importer chooses this option, the 
importer would only be required to submit the 4 elements listed above 
once to be applied to the Importer Security Filing as well as the entry 
and/or entry summary. CBP will publish technical information regarding 
the transmission of entry and Importer Security Filing data in the 
appropriate guidance documents and on the CBP Web site.
2. Importer Security Filing and Application for FTZ Admission
    Two of the Importer Security Filing elements are identical to 
elements submitted for application to admit goods to an FTZ (CBP Form 
214). These elements are the country of origin and commodity HTSUS 
number when provided at the 10 digit level. In an effort to minimize 
the redundancy of data transmitted to CBP, the proposed regulations 
allow a filer to submit the Importer Security Filing and CBP Form 214 
in the same electronic transmission to CBP and to submit the country of 
origin and commodity HTSUS number once to be used for both Importer 
Security Filing and FTZ admission purposes. If the party submitting the 
Importer Security Filing chooses to have this element used for FTZ 
admission purposes, the HTSUS number must be provided at the 10 digit 
level.

M. Public Comments; Importer Security Filing, Entry, and Application 
for FTZ Admission

Comment
    CBP should allow for entry to be made when the Importer Security 
Filing is submitted.
CBP Response
    CBP agrees. Under the proposed rule, an importer would be able to 
submit the entry and/or entry summary data via the same electronic 
transmission as the Importer Security Filing. If an importer chooses to 
do so, the consolidated submission of both the Importer Security Filing 
and entry must be filed by the party entitled to make entry pursuant to 
19 U.S.C. 1484 on its own behalf or a licensed customs broker.
Comment
    The regulations should allow an importer to submit, in lieu of an 
Importer Security Filing, CBP Forms 3461, 7501, or 214. In the 
alternative, the regulations should allow an importer to submit, in 
lieu of an Importer Security Filing, CBP Forms 3461, 7501, or 214 along 
with the consolidator (stuffer) name and address and container stuffing 
location.
CBP Response
    CBP appreciates the suggestions in this comment but disagrees. 
Importers, as defined in these regulations, or their authorized agents, 
are responsible for providing the complete Importer Security Filing 24 
hours prior to lading. The other options suggested do not satisfy the 
proposed Importer Security Filing requirements. CBP Forms 3461, 7501, 
and 214, alone or in combination with the consolidator (stuffer) name 
and address and container stuffing location, do not contain the 
required elements. However, as discussed above, CBP is proposing to 
allow an importer to submit the entry and/or entry summary data via the 
same electronic transmission as the Importer Security Filing. In 
addition, CBP is proposing to allow applicants for FTZ admission to 
submit the country of origin and HTSUS number (when provided at the 10 
digit level) once for both Importer Security Filing and FTZ admission 
purposes.
Comment
    The advance trade data required represents a redundancy of 
information.
CBP Response
    As discussed above, in an effort to reduce the redundancy of 
information presented to CBP, CBP is proposing to allow an importer to 
submit certain

[[Page 100]]

elements once to be used for both Importer Security Filing and entry 
purposes and to allow applicants for FTZ admission to submit the 
country of origin and HTSUS number once to be used for both Importer 
Security Filing and FTZ admission purposes. To the extent feasible, CBP 
will continue to explore ways and methods to harmonize and synchronize 
information collection requirements.
Comment
    CBP should extend the five-day minimum entry and selectivity time 
frame for entry release and FTZ admission purposes to after confirmed 
departure of the vessel from its last foreign port to the United 
States.
CBP Response
    CBP disagrees. CBP does not propose to amend, at this time, the 
regulations generally governing entry release and FTZ admission of 
imported goods.

V. General Public Comments

A. Economic Analysis; Cost, Benefit, and Feasibility Study

Comment
    Regulations compelling the advance submission of Importer Security 
Filing elements would impose substantial reprogramming and process 
redesign costs on importers. Furthermore, the compliance costs for an 
importer importing multiple products per container would be 
substantial. CBP should complete a cost/benefit and feasibility study 
and report, as recommended by the SAFE Port Act, before the final rule 
is published.
CBP Response
    CBP has conducted a cost, benefit, and feasibility analysis as 
required under the SAFE Port Act. This analysis meets the requirements 
of Executive Order 12866 and Office of Management and Budget (OMB) 
Circular A-4 and has been reviewed by OMB. A summary of this analysis 
is presented below, and the complete analysis can be found on the CBP 
Web site and the public docket for this rulemaking (see 
www.regulations.gov). CBP is seeking comments on this analysis.
Comment
    CBP has not had sufficient discussions with the trade community, 
particularly in view of the enormous impact that the proposal will have 
on the United States economy.
CBP Response
    CBP disagrees. CBP has engaged and will continue to engage the 
trade through the rulemaking process and through consultation as 
required by Section 203 of the SAFE Port Act (incorporating the 
requirements of Section 343(a) of the Trade Act of 2002). CBP has met 
with groups representing the trade while developing the proposal, 
including: the COAC, the American Association of Exporters and 
Importers (AAEI), the American Association of Port Authorities (AAPA), 
the Joint Industry Group (JIG), the National Association of 
Manufacturers (NAM), the National Customs Brokers and Forwarders 
Association of America (NCBFAA), the International Compliance 
Professionals Association (ICPA), the Retail Industry Leaders 
Association (RILA), the TSN, the U.S. Chamber of Commerce, and the 
World Shipping Council (WSC). CBP also posted a ``strawman'' proposal 
on the CBP Web site along with a request for comments from the trade.
Comment
    CBP has not provided any indication that it is in compliance with 
the requirements of section 343 of the Trade Act of 2002, including the 
requirement that the agency: ``[account] for the extent to which the 
technology necessary for parties to transmit, and for CBP to receive 
and analyze, data in a timely fashion, is available.''
CBP Response
    CBP is modifying existing systems to accommodate the proposed 
requirements. CBP has included the impacts to the trade to modify its 
processes as part of the cost, benefit, and feasibility study.

B. Protection of Confidential Information Presented to CBP

Comment
    CBP should keep all the security filing data confidential from 
disclosure. The data should be held as not eligible for disclosure 
under 5 U.S.C. 552 et seq. or any other statute or regulation. For 
example, many U.S. firms do not want their federal tax identification 
number made available to others. The importer may not want the seller 
to know who the ultimate ``deliver to'' party is. The importer may fear 
back solicitation by the seller/exporter. In addition, the seller may 
not want the buyer to know the name and address of the actual 
manufacturer.
    In lieu of the importer of record and/or consignee number, the 
filer should be able to indicate the name and address of the importer 
of record and ultimate consignee. American companies remain concerned 
about the misuse of the importer of record number by parties to whom 
such information is generally not provided for business confidential 
and other similar reasons.
CBP Response
    CBP agrees that we should keep Importer Security Filing, vessel 
stow plan, and container status message information confidential, 
except to the extent required by law. Pursuant to the authority under 
both section 343(a) of the Trade Act (19 U.S.C. 2071 note) and section 
203(d) of the SAFE Port Act (6 U.S.C. 943(d)), CBP is proposing to 
amend 19 CFR 103.31a to include the Importer Security Filing elements 
(including the importer of record number), vessel stow plan 
information, and container status message information to the list of 
information that is per se exempt from disclosure under 19 CFR 
103.12(d), unless CBP receives a specific request for such records 
pursuant to 19 CFR 103.5, and the owner of the information expressly 
agrees in writing to its release.
    While the importer, as defined in these regulations, is proposed to 
be responsible for providing the Importer Security Filing 24 hours 
prior to lading, CBP is proposing to allow the importer to use a 
licensed customs broker, in addition to other parties, to submit the 
Importer Security Filing. CBP recognizes the concerns of parties in 
these instances about sharing their confidential business information. 
If an importer with confidential business interests chooses to use an 
agent to file, the importer may choose to execute confidentiality 
agreements to protect those interests. Pursuant to 19 CFR 111.24, 
customs brokers are required to keep information pertaining to the 
business of clients serviced by the broker confidential.

C. Test of Concept and Phase-in Enforcement

Comment
    There should be a test of the concept and the mechanics of the 
advance data elements filing with a volunteer group before the concept 
moves to the phase-in period. The test should involve the proposed data 
set and should include the approved interfaces (such as ABI and AMS) 
for initial programming. In order for the test results to have the 
greatest validity, CBP should seek participation from parties in the 
supply chain who ship from varying parts of the world and include 
small, medium and large companies as well as those who ship using 
forwarders and those who do not. An invitation to participate in the 
testing should be published in the

[[Page 101]]

Federal Register and on the CBP Web site.
CBP Response
    As part of CBP's pre-existing Advance Trade Data Initiative (ATDI), 
CBP is working with a wide variety of volunteers from the world trade 
community to test the trade's ability to provide data, including some 
elements of the Importer Security Filing, to CBP. The ATDI test results 
will assist CBP in understanding the various formats that are being 
used in the international trade community to share supply chain 
information. Under the foregoing circumstances, we do not believe that 
a new or separate test is needed to evaluate the practical requirements 
of this rule.
Comment
    Once the final regulations are effective, CBP should adopt a phase-
in period, during which CBP should publish FAQs addressing issues 
associated with the regulations and specific guidelines on how the 
phase-in will work and what rules will apply. CBP should include 
outreach to other countries.
CBP Response
    CBP agrees. Regardless of when the regulations on this subject go 
into effect, CBP will adopt a phase-in enforcement process similar to 
that which was utilized when the 24-Hour Rule and Trade Act regulations 
were implemented. Depending on the circumstances, CBP may take an 
``informed compliance'' approach following the effective date of this 
rule. Through the phase-in enforcement process, CBP will work with the 
trade to ensure informed compliance. CBP will continue to update the 
trade on issues associated with the proposed regulations in the form of 
FAQs, postings on the CBP website, other outreach to the trade, and 
consultation with foreign countries.
Comment
    During any test period or phase-in period, CBP should consider 
requiring fewer than all of the Importer Security Filing elements and 
carrier elements.
CBP Response
    CBP disagrees. Through discussions with the trade and through the 
development of ATDI, CBP has found that the elements required under the 
proposed regulations are generally available. Moreover, CBP does not 
agree that a phase-in period requiring fewer than all of the required 
Importer Security Filing elements and carrier elements would fulfill 
the goal of enhancing the government's risk assessment capabilities.

D. Other General Comments

Comment
    Some importers may not be aware of the Importer Security Filing 
requirement, especially those traveling overseas who happen to buy 
something to ship.
CBP Response
    Under the proposed regulations, the importer, as defined in these 
regulations, is ultimately responsible for the timely, accurate, and 
complete submission of the Importer Security Filing. CBP will conduct 
outreach to the public and the trade, including postings to the CBP 
website to promote widespread knowledge of this requirement during the 
phase-in enforcement period following the final rule.
Comment
    Shipments may be diverted to Canada or Mexico to avoid the proposed 
requirements.
CBP Response
    CBP disagrees. This proposal is focused on ocean cargo primarily 
pursuant to the requirements under the SAFE Port Act. As such, this 
proposal is an incremental step toward meeting the goal of securing 
shipments to the United States. CBP does not expect shipments to be 
diverted to Canada or Mexico to avoid the proposed requirements. CBP 
will continue to evaluate the effectiveness of this rule and will 
consider additional steps, including expanding the advance data 
requirements for other transportation modes.
Comment
    If containers cannot be laden aboard the vessel, based on existing 
service contracts, companies quite possibly will face delays while they 
await another vessel for the specified contract service. These types of 
delays would create additional security risks.
CBP Response
    With regard to the concern that the proposed rule may adversely 
affect the efficiency of international shipping operations, CBP 
recognizes this legitimate concern and has taken steps to address it in 
the development of this rulemaking. First, it is important to note that 
under the proposed regulations, it is the information about the 
contents of a shipping container, not the container itself, that must 
be presented to CBP 24 hours prior to lading at a foreign seaport. 
Under this proposed rule, so long as the Importer Security Filing is 
provided to CBP 24 hours in advance of lading, the container itself may 
be brought to the seaport at a later time. Second, the development of 
this proposal has been designed to take advantage of the existing 
shipping cycle. In most foreign seaports, containers destined to the 
United States are often stored at terminals for several hours or 
several days before lading. This provides ample opportunity for CBP and 
its foreign CSI partners to identify and screen potentially high-risk 
containers within the normal shipping cycle and without causing any 
unnecessary delays. Third, by screening potentially high-risk 
containers at foreign seaports during the normal shipping cycle, CBP 
will use the additional advance information to further expedite low 
risk shipments. This should not only reduce delays associated with 
targeting and screening containers for security purposes upon arrival 
in the United States; it should also add greater predictability to the 
movement of containers through domestic seaports.
    CBP recognizes that some changes to business practices may be 
required in order to transmit the data required under this proposed 
rule. For example, although much, if not all, of the data required by 
CBP is available prior to lading, CBP recognizes that businesses 
currently may not be configured to collect and transmit such 
information in compliance with the rule. This is one of the reasons 
that CBP is proposing to phase in enforcement of the rule--to strike an 
appropriate balance between the needs of business and the need of the 
government to address the immediate threat that international terrorist 
organizations pose to the United States and the global economy.
Comment
    CBP should ensure that the information collected pursuant to the 
proposed regulations will be used exclusively for ensuring 
transportation safety and security, and not for any other commercial 
enforcement purposes.
CBP Response
    CBP agrees. If the proposed regulations are adopted as final, 
pursuant to section 343(a)(3)(F) of the Trade Act of 2002, as amended 
by the MTSA, CBP will use the data required by this rule ``exclusively 
for ensuring cargo safety and security and preventing smuggling'' and 
will not use the data for ``determining merchandise entry or for

[[Page 102]]

any other commercial enforcement purposes.''

VI. Amendments to Bond Conditions

    In order to provide a clear enforcement mechanism for the proposed 
requirements, CBP is proposing to amend regulations covering certain 
bond conditions to include agreements to pay liquidated damages for 
violations of the new proposed regulations. CBP is also proposing to 
amend the bond conditions for violations of the advance cargo 
information requirements under the Trade Act regulations in order to 
make the liquidated damages amounts for those violations consistent 
with the liquidated damages amounts for violations of the proposed 
requirements. As discussed above, upon implementation of the final 
rule, CBP will adopt a phase-in enforcement process for the new 
requirements similar to that which was utilized when the 24-Hour Rule 
and Trade Act regulations were implemented.

A. Bond Conditions Related to the Proposed Importer Security Filing, 
Vessel Stow Plan, and Container Status Message Requirements

    The proposed regulations would add a new condition to those 
provisions in 19 CFR 113.62 required to be included in a basic 
importation and entry bond. Specifically, CBP is proposing to amend 19 
CFR 113.62 to include a condition whereby the principal agrees to 
comply with the proposed Importer Security Filing requirements. If the 
principal fails to comply with the proposed Importer Security Filing 
requirements, the principal and surety (jointly and severally) would 
pay liquidated damages equal to the value of the merchandise involved 
in the default.
    The proposed regulations would also amend those provisions in 19 
CFR 113.64 required to be included in an international carrier bond. 
Specifically, CBP is proposing to amend 19 CFR 113.64 to include three 
new conditions. First, a new condition would be added whereby the 
principal agrees to comply with the proposed Importer Security Filing 
requirements if the principal elects to provide the Importer Security 
Filing on behalf of an importer, as defined in these regulations. If 
the principal fails to comply with the proposed Importer Security 
Filing requirements, the principal and surety (jointly and severally) 
would agree to pay liquidated damages equal to the value of the 
merchandise involved in the default. Second, a new condition would be 
added whereby the principal agrees to comply with the proposed vessel 
stow plan requirements. If the principal fails to comply with the 
proposed vessel stow plan requirements, the principal and surety 
(jointly and severally) would agree to pay liquidated damages of 
$50,000 for each vessel arrival. Third, a new condition would be added 
whereby the principal agrees to comply with the proposed container 
status message requirements. If the principal fails to timely provide 
CSMs for all events that occur relating to a container, for which the 
carrier creates or collects CSMs in its equipment tracking system, the 
principal and surety (jointly and severally) would pay liquidated 
damages of $5,000 for each violation, to a maximum of $100,000 per 
vessel arrival.
    Lastly, the proposed regulations would amend those provisions in 19 
CFR 113.73 required to be included in a foreign trade zone operator 
bond. Specifically, CBP is proposing to amend 19 CFR 113.73 to include 
a condition whereby the principal agrees to comply with the Importer 
Security Filing requirements. If the principal fails to comply with the 
proposed Importer Security Filing requirements, the principal and 
surety (jointly and severally) would pay liquidated damages equal to 
the value of the merchandise involved in the default.

B. Bond Conditions Related to the Trade Act Regulations

    The proposed regulations would also amend the liquidated damages 
amounts for violations of the advance cargo information requirements 
under 19 CFR 4.7 and 4.7a in order to make those amounts consistent 
with the liquidated damages amounts for violations of the proposed 
container status message requirements ($5,000 for each violation) and 
more in line with the liquidated damages for violations of the proposed 
Importer Security Filing requirements. Accordingly, CBP is proposing to 
amend 19 CFR 4.7, 4.7a, and 113.64 to include liquidated damages 
amounts of $5,000 for each violation of the advance cargo information 
requirements, to a maximum of $100,000 per conveyance arrival.

VIII. Regulatory Analyses

A. Executive Order 12866

    This rule is considered to be an economically significant 
regulatory action under Executive Order 12866 because it may result in 
the expenditure of over $100 million in any one year. Accordingly, this 
proposed rule has been reviewed by the Office of Management and Budget 
(OMB). The following summary presents the costs and benefits of the 
proposed rule plus a range of alternatives considered. (The 
``Regulatory Assessment'' can be found in the docket for this 
rulemaking: http://www.regulations.gov; see also http://www.cbp.gov).
    In this analysis, we first estimate current and future baseline 
conditions in the absence of the proposed rule using 2005 shipping 
data. In this baseline analysis, we characterize and estimate the 
number of unique shipments, carriers, and vessel-trips potentially 
affected by the proposed rule. We then identify the incremental 
measures that importers and carriers will take to meet the requirements 
of the proposed rule and estimate the costs of these activities, as 
well as the cost to CBP of implementing the rule. Next, relying on 
published literature, we identify hypothetical scenarios describing 
representative terrorist attacks potentially prevented by this 
regulation and estimate the economic costs (i.e., the consequences) of 
these events. We compare these consequences to the costs of the 
proposed regulation and estimate the reduction in the probability of a 
successful terrorist attack resulting from the proposed regulation that 
would be required for the benefits of the regulation to equal the costs 
of the regulation. Finally, we consider the distribution of costs to 
sensitive subgroups such as small entities and the energy sector.
    As of the projected effective date of the regulation, we estimate 
that approximately 11 million import shipments conveyed by 1,200 
different carrier companies operating 50,000 unique voyages or vessel-
trips to the United States will be subject to the proposed rule. Table 
1 summarizes the results of the regulatory analysis. We consider and 
evaluate the following four alternatives:
    Alternative 1 (the chosen alternative): Importer Security Filings 
and Additional Carrier Requirements are required. Bulk cargo is exempt 
from the Importer Security Filing requirements;
    Alternative 2: Importer Security Filings and Additional Carrier 
Requirements are required. Bulk cargo is not exempt from the Importer 
Security Filing requirements;
    Alternative 3: Only Importer Security Filings are required. Bulk 
cargo is exempt from the Importer Security Filing requirements; and,
    Alternative 4: Only the Additional Carrier Requirements are 
required.

[[Page 103]]



                                                              Table 1.--Summary of Findings
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                         Percent
                                                                                      reduction in
                                                                                      baseline risk    Number of these events
          Discount rate              Annualized costs    Terrorist attack scenario    that must be    that must be avoided for           Comment
                                    (2008-2017, $2007)                                achieved for     benefits to equal costs
                                                                                       benefits to
                                                                                       equal costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
                  Alternative 1 (chosen alternative): Importer Security Filings and Additional Carrier Requirements, bulk cargo exempt
--------------------------------------------------------------------------------------------------------------------------------------------------------
3%...............................  $390 million to $620  Actual West Coast Port         25.6 to 41.0  One event in 2 to 4       Preferred Alternative:
                                    million.              Shutdown (12-days).                          years.                    Most favorable
                                                                                                                                 combination of cost and
                                                                                                                                 stringency.
                                                         Hypothetical Nuclear             0.1 to 0.2  One event in 700 to
                                                          Attack.                                      1,100 years.
                                                         Hypothetical Biological          0.9 to 1.4  One event in 70 to 100
                                                          Attack.                                      years.
7%...............................  $390 million to $630  Actual West Coast Port         26.1 to 42.0  One event in 2 to 4
                                    million.              Shutdown (12-days).                          years.
                                                         Hypothetical Nuclear             0.1 to 0.2  One event in 600 to
                                                          Attack.                                      1,000 years.
                                                         Hypothetical Biological          0.9 to 1.4  One event in 70 to 100
                                                          Attack.                                      years.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                           Alternative 2: Importer Security Filings and Additional Carrier Requirements, bulk cargo not exempt
--------------------------------------------------------------------------------------------------------------------------------------------------------
3%...............................  $390 million to $620  Actual West Coast Port         25.7 to 41.3  One event in 2 to 4       More stringent than
                                    million.              Shutdown (12-days).                          years.                    Alternative 1, but
                                                                                                                                 limited expected
                                                                                                                                 additional benefit for
                                                                                                                                 increased cost.
                                                         Hypothetical Nuclear             0.1 to 0.2  One event in 700 to
                                                          Attack.                                      1,100 years.
                                                         Hypothetical Biological          0.9 to 1.4  One event in 70 to 100
                                                          Attack.                                      years.
7%...............................  $400 million to $640  Actual West Coast Port         26.3 to 42.3  One event in 2 to 4
                                    million.              Shutdown (12-days).                          years.
                                                         Hypothetical Nuclear             0.1 to 0.2  One event in 600 to
                                                          Attack.                                      1,000 years.
                                                         Hypothetical Biological          0.9 to 1.5  One event in 70 to 100
                                                          Attack.                                      years.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                            Alternative 3: Importer Security Filings only, bulk cargo exempt
--------------------------------------------------------------------------------------------------------------------------------------------------------
3%...............................  $380 million to $610  Actual West Coast Port         25.5 to 40.3  One event in 3 to 4       Similar cost to
                                    million.              Shutdown (12-days).                          years.                    Alternative 1 with
                                                                                                                                 decreased
                                                                                                                                 effectiveness. Importer
                                                                                                                                 Security Filings and
                                                                                                                                 Additional Carrier
                                                                                                                                 Requirements are not
                                                                                                                                 working in tandem.
                                                         Hypothetical Nuclear                    0.1  One event in 700 to
                                                          Attack.                                      1,100 years.
                                                         Hypothetical Biological          0.9 to 1.4  One event in 70 to 100
                                                          Attack.                                      years.
7%...............................  $390 million to $620  Actual West Coast Port         26.1 to 41.2  One event in 2 to 4
                                    million.              Shutdown (12-days).                          years.
                                                         Hypothetical Nuclear             0.1 to 0.2  One event in 700 to
                                                          Attack.                                      1,000 years.
                                                         Hypothetical Biological          0.9 to 1.4  One event in 70 to 100
                                                          Attack.                                      years.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                   Alternative 4: Additional Carrier Requirements only
--------------------------------------------------------------------------------------------------------------------------------------------------------
3%...............................  $3 million to $12     Actual West Coast Port           0.2 to 0.8  One event in 100 to 600   Least cost, but also
                                    million.              Shutdown (12-days).                          years.                    least effective
                                                                                                                                 alternative. Does not
                                                                                                                                 meet the statutory
                                                                                                                                 requirements of Section
                                                                                                                                 203 of the SAFE Port
                                                                                                                                 Act nor provide data on
                                                                                                                                 shipment history.
                                                                                                                                 Importer Security
                                                                                                                                 Filings and Additional
                                                                                                                                 Carrier Requirements
                                                                                                                                 are not working in
                                                                                                                                 tandem.
                                                         Hypothetical Nuclear                   <0.1  One event in 33,000 to
                                                          Attack.                                      160,000 years.
                                                         Hypothetical Biological                <0.1  One event in 4,000 to
                                                          Attack.                                      18,000 years.

[[Page 104]]

 
7%...............................  $3 million to $13     Actual West Coast Port           0.2 to 0.9  One event in 100 to 600
                                    million.              Shutdown (12-days).                          years.
                                                         Hypothetical Nuclear                   <0.1  One event in 31,000 to
                                                          Attack.                                      150,000 years.
                                                         Hypothetical Biological                <0.1  One event in 3,000 to
                                                          Attack.                                      16,000 years.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The annualized cost range presented in each cell results from 
varying assumptions about the estimated security filing transaction 
costs or fees charged to the importers by the filing parties, the 
potential for supply chain delays, and the estimated costs to transmit 
Vessel Stow Plans and CSMs to CBP.
    We estimate costs separately for the Importer Security Filing 
requirements (up to 10 importer data elements) and the additional 
carrier requirements (Vessel Stow Plans and CSMs). The estimated costs 
for the Importer Security Filing requirements are developed on a per-
shipment basis and applied to the estimated number of shipments 
annually for a period of 10 years (2008 through 2017). The 10-year 
calculation likely reflects the maximum time frame that we could 
reasonably project trends in international shipping. In addition, we 
estimate costs associated with potential delays in the supply chain 
that may result from having to meet the proposed filing deadline of 24 
hours prior to lading at the foreign port. The estimated costs for the 
additional carrier requirements are developed on per-carrier and per 
vessel-trip bases and applied to the estimated number of carriers and 
vessel-trips in each year of the 10-year analysis period.
    To estimate the full range of the total estimated costs for 
complying with the proposed rule, for the four alternatives we develop 
a high cost scenario and a low cost scenario by assuming certain values 
for the key cost factors. Annualized costs for Alternatives 1 through 3 
range from $380 million to $640 million, depending on the discount rate 
applied, the cost scenario, whether or not bulk shipments are exempt, 
and whether or not the Additional Carrier Requirements are required. 
The annualized costs for Alternative 4 are substantially lower, ranging 
from $3 million to $13 million. However, this alternative is the least 
stringent and effective option, because it only collects data on the 
conveyance of the shipment. Further, it does not meet the statutory 
requirements of Section 203 of the SAFE Port Act. Because costs are 
likely to exceed $100 million annually, the proposed regulation 
represents an economically significant regulatory action as defined by 
E.O. 12866.
    Ideally, the quantification and monetization of the benefits of 
this regulation would involve estimating the current level of risk of a 
successful terrorist attack, absent this regulation, and the 
incremental reduction in risk resulting from implementation of the 
proposed regulation. We would then multiply the change by an estimate 
of the value individuals place on such a risk reduction to produce a 
monetary estimate of direct benefits. However, existing data 
limitations and a lack of complete understanding of the true risks 
posed by terrorists prevent us from establishing the incremental risk 
reduction attributable to this rule. As a result, we undertake a 
``break-even'' analysis to inform decision-makers of the necessary 
incremental change in the probability of such an event occurring that 
would result in direct benefits equal to the costs of the proposed 
rule.
    In the break-even analysis, we identify three types of terrorist 
attack scenarios that may be prevented by the regulation and obtain 
cost estimates of the consequences of these events from published 
literature. The analysis compares the annualized costs of the 
regulation to the avoided costs of each event to estimate the reduction 
in the probability of such events (also presented in terms of ``odds,'' 
e.g., a 0.25 reduction in the probability of an event occurring in a 
single year implies that one additional event must be avoided in a 
four-year period) that must be achieved for the benefits of the 
regulation to equal the costs. The reduction in the odds of terrorist 
events are rough estimates that do not take into account changes in 
risk through time or factors that may affect willingness to pay to 
avoid the consequences of these events, such as changes in income.
    For each attack scenario, Table 1 indicates what would need to 
occur for the costs of each alternative to equal its benefits, assuming 
the alternative only reduces the risk of a single event of that type of 
attack. As summarized in Table 1, the break-even risk reductions for 
Alternative 4 are significantly lower than the other three 
alternatives, reflecting the significantly lower costs associated with 
requiring only the Additional Carrier Requirements. The break-even 
results for the remaining three alternatives are similar because the 
costs of these options are not very different. For the most severe 
attack scenario (a hypothetical nuclear attack in a major city), the 
proposed regulation must result in the avoidance of one such event in a 
time period of 600 to 1,100 years for the benefits of the regulation to 
equal the costs. For the least severe of the three hypothetical attack 
scenarios (costs of the actual 12-day West Coast port shutdown), the 
estimated costs of a single incident are closer in value to the 
annualized costs of the proposed regulation. As a result, if the rule 
only reduced the risk of a single attack on a port, a shutdown would 
need to be avoided once in a period of two to four years for the 
benefits of the rule to equal costs. The results expressed as percent 
reductions in baseline risk also show higher reductions needed if port 
attacks only are mitigated (about 26 to 42 percent) and lesser 
reductions associated with prevention of the more catastrophic events. 
We note that this analysis is highly sensitive to the chosen incident 
scenarios.
    Total present value costs of the proposed regulation are presented 
in Table 2, based on the cost projections we estimate for the 10-year 
analysis period, 2008 through 2017. Applying a social discount rate of 
three percent, the total costs of Alternatives 1, 2, and 3 are 
projected to range from $3.3 billion to $5.3 billion over 10 years 
depending on

[[Page 105]]

the cost scenario, whether or not bulk shipments are exempt, and 
whether or not Additional Carrier Requirements are required. If a 
social discount rate of seven percent is applied instead, total costs 
range from $2.7 billion to $4.5 billion. Under Alternative 2, which 
requires Importer Security Filings for both non-bulk cargo and bulk 
cargo, costs are not significantly higher because the number of bulk 
shipments is relatively small compared to the number of non-bulk 
shipments. Under Alternative 3, costs are not significantly lower 
because the estimated costs for the Additional Carrier Requirements are 
relatively small compared to the estimated costs for the Importer 
Security Filings. The estimated costs for Alternative 4 are 
significantly lower than the other three alternatives, ranging from $19 
million to $104 million.

             Table 2.--Total Present Value Costs, 2008-2017
                                 [$2007]
------------------------------------------------------------------------
               Discount rate                     Present value costs
------------------------------------------------------------------------
    Alternative 1 (chosen alternative): Importer Security Filings and
           Additional Carrier Requirements, bulk cargo exempt
------------------------------------------------------------------------
3%........................................  $3.3 billion to $5.3 billion
7%........................................  $2.8 billion to $4.4 billion
------------------------------------------------------------------------
     Alternative 2: Importer Security Filings and Additional Carrier
                   Requirements, bulk cargo not exempt
------------------------------------------------------------------------
3%........................................  $3.3 billion to $5.3 billion
7%........................................  $2.8 billion to $4.5 billion
------------------------------------------------------------------------
    Alternative 3: Importer Security Filings only, bulk cargo exempt
------------------------------------------------------------------------
3%........................................  $3.3 billion to $5.2 billion
7%........................................  $2.7 billion to $4.4 billion
------------------------------------------------------------------------
           Alternative 4: Additional Carrier Requirements only
------------------------------------------------------------------------
3%........................................  $0.02 billion to $0.1
                                             billion
7%........................................  $0.02 billion to $0.1
                                             billion
------------------------------------------------------------------------
------------------------------------------------------------------------

    Again, the range presented in each cell results from varying 
assumptions about the estimated security filing transaction costs or 
fees charged to the importers by the filing parties, the potential for 
supply chain delays, and the estimated costs to transmit Vessel Stow 
Plans and CSMs to CBP.
    Annual undiscounted costs of the regulation are presented in Table 
3.

                             Table 3.--Annual Undiscounted Costs by Year, 2008-2017
                                              [$2007, in millions]
----------------------------------------------------------------------------------------------------------------
                                        Alternative 1
                                           (chosen         Alternative 2:
                                        alternative):    Importer security
                                      Importer security     filings and       Alternative 3:     Alternative 4:
                Year                     filings and         additional     Importer security      Additional
                                          additional          carrier         filings only,         carrier
                                           carrier         requirements,    bulk cargo exempt  requirements only
                                        requirements,      bulk cargo not
                                      bulk cargo exempt        exempt
----------------------------------------------------------------------------------------------------------------
2008................................       $300 to $520       $300 to $520       $290 to $490          $1 to $30
2009................................         310 to 500         310 to 500         310 to 490             1 to 7
2010................................         330 to 520         330 to 530         330 to 520             1 to 7
2011................................         340 to 550         350 to 550         340 to 540             1 to 7
2012................................         360 to 580         370 to 580         360 to 570             1 to 8
2013................................         380 to 610         390 to 610         380 to 600             1 to 8
2014................................         400 to 640         410 to 650         400 to 630             1 to 8
2015................................         420 to 680         430 to 680         420 to 670             1 to 8
2016................................         450 to 710         450 to 710         450 to 700             1 to 8
2017................................         470 to 750         470 to 750         470 to 740             1 to 8
----------------------------------------------------------------------------------------------------------------

    As shown in Table 3, the annual discounted costs increase from 
year-to-year over the 10-year analysis period. This increase reflects 
our projected annual increases in the number of shipments, value of 
shipments, and vessel-trips into the United States potentially affected 
by the proposed rule.
    The results indicate that Alternative 1 provides the most favorable 
combination of cost and stringency. While Alternative 2 might be 
considered more stringent because it does not exempt bulk cargo from 
the Importer Security Filing requirements, the impact of this is 
expected to be slight, because the number of bulk shipments is 
relatively small compared to the number of non-bulk shipments. 
Alternative 3 is expected to have costs similar to Alternative 1, but 
will be less stringent because it only requires Importer Security 
Filings and does not include data that verify the information on the 
cargo manifest and identify and track the movement, location, and 
status of cargo (and in particular, containerized cargo) from the time 
its transport is booked until its arrival in the United States. Without 
the Additional Carrier Requirements, CBP will not be able to assess the 
specific risks associated with the many individual movements and 
transfers involved in shipping cargo to the United States. Thus, an 
important element of CBP's layered, risk-based approach to cargo 
security would, consequently, be omitted.
    Alternatives 3 and 4 are not chosen, in part, because it is CBP's 
judgment that neither of these options will be as effective as the 
selected option. Specifically, the Importer Security Filing 
requirements and the Additional Carrier Requirements work in tandem. 
The Additional Carrier Requirements focus on the conveyance of the 
goods and are distinct from the Importer Security Filing elements, 
which are focused on the merchandise and the parties involved in the 
acquisition process. Specifically, Vessel Stow Plans will assist CBP in 
validating other advanced cargo information submissions by allowing CBP 
to, among

[[Page 106]]

other things, better detect unmanifested containers without relying on 
physical verification methods that are manpower intensive and costly. 
CSMs will provide CBP with additional transparency into the custodial 
environment through which inter-modal containers are handled and 
transported before arrival in the United States. Because CSMs are 
created independently of the manifest, CBP can utilize them to 
corroborate other advanced data elements, including Importer Security 
Filings and those elements related to container and conveyance origin. 
This corroboration with other advanced data messages, including 
Importer Security Filings, and an enhanced view into the international 
supply chain will contribute to the security of the United States and 
the international supply chain through which containers and imported 
cargo are shipped to U.S. ports.
    Based on this analysis of alternatives, CBP has determined that 
Alternative 1 provides the most favorable balance between security 
outcomes and impacts to maritime transportation. As summarized in Table 
4, the incremental costs of this regulation, on a per shipment basis, 
is a very small fraction of the value of a shipment. The relatively 
high cost of the rule over 10 years is driven by the large volume of 
shipments, not high per-transaction costs. Shipment data indicate that 
the median value of a shipment of goods imported into the United States 
is approximately $37,000. As shown in Table 4, the increase in costs of 
imported shipments will range from $20 to $38 per shipment, depending 
on the discount rate applied, the cost scenario, and whether or not 
bulk shipments are exempt. The added costs of this regulation are 
estimated to be only 0.05 percent to 0.10 percent of the median value 
of $37,000 per shipment. CBP welcomes comments on these conclusions and 
the regulatory alternatives considered.

Table 4.--Costs per Shipment, Median Value of Shipment, Vessel-trip, and
                                 Carrier
                                 [$2007]
------------------------------------------------------------------------
                                   3% discount rate    7% discount rate
------------------------------------------------------------------------
Importer Security Filing Costs: Alternatives 1 and 3 (bulk cargo exempt)
------------------------------------------------------------------------
Total Present Value Cost........  $3.3 billion to     $2.7 billion to
                                   $5.2 billion.       $4.4 billion
Number of shipments (10-year      137 million.......  137 million
 total).
Equivalent per shipment cost....  $24 to $38........  $20 to $32
Median value per shipment.......  $36,900...........  $36,900
Cost per median value...........  0.06 to 0.10        0.05 to 0.09
                                   percent.            percent
------------------------------------------------------------------------
  Importer Security Filing costs: Alternative 2 (bulk cargo not exempt)
------------------------------------------------------------------------
Total Present Value Cost........  $3.3 billion to     $2.8 billion to
                                   $5.2 billion.       $4.4 billion
Number of shipments (10-year      138 million.......  138 million
 total).
Equivalent per shipment cost....  $24 to $38........  $20 to $32
Median value per shipment.......  $37,200...........  $37,200
Cost per median value...........  0.06 to 0.10        0.05 to 0.09
                                   percent.            percent
------------------------------------------------------------------------
            Vessel Stow Plan Costs: Alternatives 1, 2, and 4
------------------------------------------------------------------------
Total present value cost........  $6 million to $35   $5 million to $30
                                   million.            million
Number of non-bulk vessel-trips,  414,000...........  414,000
 small and large carriers (10-
 year total).
Equivalent per vessel-trip cost.  $14 to $84........  $12 to $73
------------------------------------------------------------------------
        Container Status Message Costs: Alternatives 1, 2, and 4
------------------------------------------------------------------------
Total present value cost........  $0.3 million to     $0.3 million to
                                   $54 million.        $49 million
Number of container carriers,     74................  74
 large.
Equivalent per carrier cost.....  $4,000 to $730,000  $4,000 to $660,000
------------------------------------------------------------------------

    The proposed regulation may increase the time shipments are in 
transit, particularly for shipments consolidated in containers. For 
such shipments, the supply chain is generally more complex and the 
importer has less control of the flow of goods and associated security 
filing information. Foreign cargo consolidators may be consolidating 
multiple shipments from one or more shippers in a container destined 
for one or more buyers or consignees. In order to ensure that the 
security filing data is provided by the shippers to the importers (or 
their designated agents) and is then transmitted to and accepted by CBP 
in advance of the 24-hour deadline, consolidators may advance their 
cut-off times for receipt of shipments and associated security filing 
data.
    These advanced cut-off times would help prevent a consolidator or 
carrier from having to unpack or unload a container in the event the 
security filing for one of the shipments contained in the container is 
inadequate or not accepted by CBP. For example, consolidators may 
require shippers to submit, transmit, or obtain CBP approval of their 
security filing data before their shipments are stuffed in the 
container, before the container is sealed, or before the container is 
delivered to the port for lading. In such cases, importers would likely 
have to increase the times they hold their goods as inventory and thus 
incur additional inventory carrying costs to sufficiently meet these 
advanced cut-off times imposed by their foreign consolidators. The high 
end of the cost ranges presented in Table 4 assumes an initial supply 
chain delay of 1 day (24 hours) for the first year of implementation 
(2008) and a delay of 12 hours for years 2 through 10 (2009-2017).

B. Regulatory Flexibility Act

    In response to the requirements of the Regulatory Flexibility Act 
(RFA) of 1980, as amended by the Small Business Regulatory Enforcement 
Fairness Act of 1996 (SBREFA) and Executive Order

[[Page 107]]

13272, entitled ``Proper Consideration of Small Entities in Agency 
Rulemaking,'' Federal agencies must consider the potential 
distributional impact of rules on small businesses, small governmental 
jurisdictions, and small organizations during the development of their 
rules. Because the proposed rule affects all importers and carriers 
bringing goods to the United States, it likely affects a substantial 
number of small entities in each industry conducting these activities. 
However, due to data limitations, we cannot determine if these effects 
will be significant on a per-entity basis. Therefore, at this time, CBP 
cannot certify that the proposed rule will not have a significant 
impact on a substantial number of small entities. CBP seeks comments on 
this conclusion. (The detailed Initial Regulatory Flexibility Act 
analysis is contained in the ``Regulatory Assessment,'' which can be 
found in the docket for this rulemaking: http://www.regulations.gov; 
see also http://www.cbp.gov).
    A description of the reasons why action by the agency is being 
considered: the description of the proposed action is contained above.
    A succinct statement of the objectives of, and legal basis for, the 
proposed rule: Section 203(b) of the Security and Accountability for 
Every Port Act (SAFE Port Act) of 2006 states that the Secretary of 
Homeland Security ``shall require the electronic transmission to the 
Department of additional data elements for improved high-risk 
targeting, including appropriate elements of entry data * * * to be 
provided as advanced information with respect to cargo destined for 
importation into the United States prior to loading of such cargo on 
vessels at foreign ports.'' The information required is that which is 
reasonably necessary to enable high-risk shipments to be identified so 
as to prevent smuggling and ensure cargo safety and security pursuant 
to the laws enforced and administered by CBP. In addition, section 
343(a) of the Trade Act of 2002 states that the Secretary of Homeland 
Security ``shall promulgate regulations providing for the transmission 
* * * of information pertaining to cargo destined for importation into 
the United States * * *.''
    A description of, and, where feasible, an estimate of the number of 
small entities to which the proposed rule will apply: The proposed rule 
applies to all entities importing containerized, break-bulk, or Ro-Ro 
shipments into the United States. Under the chosen alternative, bulk 
shipments are exempt from the proposed rule. The proposed regulation 
also applies to VOCCs transporting shipments via sea to the United 
States. The majority of the affected entities are likely to be small.
    A description of the projected reporting, recordkeeping and other 
compliance requirements of the proposed rule, including an estimate of 
the classes of small entities that will be subject to the requirement 
and the type of professional skills necessary for preparation of the 
report or record: The requirements of the proposed rule are expected to 
be submitted electronically by importers or VOCCs (or an agent 
representing either).
    An identification, to the extent practicable, of all relevant 
federal rules which may duplicate, overlap or conflict with the 
proposed rule: The data elements required to be submitted in this 
proposed rule are, largely, already required under existing Federal 
rules (e.g., the 24-Hour Advance Vessel Manifest Rule, customs entry 
requirements). The main impact of this proposed rule, in addition to 
increasing the number of required data elements, is to change the 
timeframe prior to departure from the foreign port and prior to arrival 
at the U.S. port in which submittal is required.
    An establishment of any significant alternatives to the proposed 
rule that accomplish the stated objectives of applicable statutes and 
that minimize any significant economic impact of the proposed rule on 
small entities: CBP does not identify any significant alternatives to 
the proposed rule that specifically address small entities. Alternative 
1, under which bulk cargo is exempt, is the chosen alternative.

C. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandate Reform Act of 1995 (UMRA) requires 
agencies to assess the effects of their regulatory actions on State, 
local, and tribal governments and the private sector. The proposed 
regulation is exempt from these requirements under 2 U.S.C. 1503 
(Exclusions) which states that UMRA ``shall not apply to any provision 
in a bill, joint resolution, amendment, motion, or conference report 
before Congress and any provision in a proposed or final Federal 
regulation that is necessary for the national security or the 
ratification or implementation of international treaty obligations.''

D. Paperwork Reduction Act

    There are three proposed collections of information in this 
document. The proposed collections are contained in 19 CFR 4.7c, 4.7d, 
and 149.2. This information would be used by CBP to further improve the 
ability of CBP to identify high-risk shipments so as to prevent 
smuggling and ensure cargo safety and security. The likely respondents 
and/or recordkeepers are individuals and businesses.
    Under Sec.  4.7c, a vessel stow plan would be required from a 
carrier when that carrier causes a vessel to arrive in the United 
States. Vessel stow plans are used to transmit information about cargo 
loaded aboard a vessel.
    Under Sec.  4.7d, container status messages would be required from 
an incoming carrier for all containers laden with cargo destined to be 
transported by that carrier and to arrive within the limits of a port 
in the United States by vessel. Container status messages serve to 
facilitate the intermodal handling of containers by streamlining the 
information exchange between trading partners involved in 
administration, commerce, and transport of containerized shipments. The 
messages can also be used to report terminal container movements (e.g., 
loading and discharging the vessel) and to report the change in status 
of containers (e.g., empty or full). Container status messages would 
provide CBP with additional transparency into the custodial environment 
through which inter-modal containers are handled and transported before 
arrival and after unlading in the U.S. This enhanced view (in 
corroboration with other advance data messages) into the international 
supply chain would contribute to the security of the United States and 
in the international supply chain through which containers and import 
cargos reach ports in the United States.
    Under Sec.  149.2, an Importer Security Filing, consisting of 
security elements of entry data for cargo destined to the United 
States, would be required from the importer, as defined in these 
regulations. For foreign cargo remaining on board (FROB), the importer 
would be construed as the carrier. For immediate exportation (IE) and 
transportation and exportation (T&E) in-bond shipments, and goods to be 
delivered to a foreign trade zone (FTZ), the importer would be 
construed as the party filing the IE, T&E, or FTZ documentation with 
CBP.
    The collection of information encompassed within this proposed rule 
has been submitted to the Office of Management and Budget (OMB) for 
review in accordance with the Paperwork Reduction Act of 1995 (44 
U.S.C. 3507). An agency may not conduct, and a person is not required 
to respond to, a collection of information unless the collection of 
information

[[Page 108]]

displays a valid control number assigned by OMB.
Estimated Burden for Carrier Requirements Under Sec.  4.7c
    Estimated annual reporting and/or recordkeeping burden: 59,542 
hours.
    Estimated average annual burden per respondent/recordkeeper: 1 hour 
per Vessel Stow Plan per carrier.
    Estimated number of respondents and/or recordkeepers: 958.
    Estimated annual frequency of responses: dependent on number of 
vessel arrivals in the United States.
Estimated Burden for Carrier Requirements Under Sec.  4.7d
    Estimated annual reporting and/or recordkeeping burden: 6,753 
hours.
    Estimated average annual burden per respondent/recordkeeper: 15 
minutes per day per carrier.
    Estimated number of respondents and/or recordkeepers: 958.
    Estimated annual frequency of responses: dependent on number of 
vessel arrivals in the United States.
Estimated Burden for Importer Requirements Under Sec.  149.2
    Estimated annual reporting and/or recordkeeping burden: 10,482,907 
hours.
    Estimated average annual burden per respondent/recordkeeper: 52.3 
hours.
    Estimated number of respondents and/or recordkeepers: 200,438.
    Estimated annual frequency of responses: dependent on number of 
shipments to the United States.
    Comments on the collection of information should be sent to the 
Office of Management and Budget, Attention: Desk Officer of the 
Department of Homeland Security, Office of Information and Regulatory 
Affairs, Washington, DC 20503. A copy should also be sent to the Border 
Security Regulations Branch, Office of International Trade, U.S Customs 
and Border Protection, 1300 Pennsylvania Avenue, NW. (Mint Annex), 
Washington, DC 20229. Comments should be submitted within the time 
frame that comments are due regarding the substance of the proposal.
    Comments are invited on: (a) Whether the collection is necessary 
for the proper performance of the functions of the agency, including 
whether the information will have practical utility; (b) the accuracy 
of the agency's estimate of the burden of the collection of the 
information; (c) ways to enhance the quality, utility, and clarity of 
the information to be collected; (d) ways to minimize the burden of the 
collection of information on respondents, including through the use of 
automated collection techniques or other forms of information 
technology; and (e) estimates of capital or startup costs and costs of 
operations, maintenance, and purchases of services to provide 
information.
    The list of approved information collections, contained in 19 CFR 
Part 178, would be revised to add an appropriate reference to sections 
4.7c, 4.7d, and 149.2 upon adoption of the proposal as a final rule.

IX. Signing Authority

    The signing authority for these amendments falls under 19 CFR 
0.1(b). Accordingly, this document is signed by the Secretary of 
Homeland Security (or his delegate).

X. Proposed Regulatory Amendments

List of Subjects

19 CFR part 4

    Customs duties and inspection, Freight, Maritime carriers, 
Reporting and recordkeeping requirements, Vessels.

19 CFR part 12

    Customs duties and inspection, Reporting and recordkeeping 
requirements.

19 CFR part 18

    Common carriers, Customs duties and inspection, Freight, Penalties, 
Reporting and recordkeeping requirements, Surety bonds.

19 CFR part 101

    Customs duties and inspection, Vessels.

19 CFR part 103

    Administrative practice and procedure, Confidential business 
information, Courts, Freedom of information, Law enforcement, Privacy, 
Reporting and recordkeeping requirements.

19 CFR part 113

    Common carriers, Customs duties and inspection, Freight, Reporting 
and recordkeeping requirements, Surety bonds.

19 CFR part 122

    Administrative practice and procedure, Customs duties and 
inspection, Penalties, Reporting and recordkeeping requirements.

19 CFR part 123

    Customs duties and inspection, Freight, Reporting and recordkeeping 
requirements, Vessels.

19 CFR part 141

    Customs duties and inspection, Reporting and recordkeeping 
requirements.

19 CFR part 143

    Customs duties and inspection, Reporting and recordkeeping 
requirements.

19 CFR part 149

    Arrival, Declarations, Customs duties and inspection, Freight, 
Importers, Imports, Merchandise, Reporting and recordkeeping 
requirements, Shipping, Vessels.

19 CFR part 192

    Penalties, Reporting and recordkeeping requirements, Vessels.

Amendments to the Regulations

    It is proposed to amend parts 4, 12, 18, 101, 103, 113, 122, 123, 
141, 143, 149, and 192 of title 19, Code of Federal Regulations (19 CFR 
parts 4, 12, 18, 101, 103, 113, 122, 123, 141, 143, 149, and 192), as 
set forth below.

PART 4--VESSELS IN FOREIGN AND DOMESTIC TRADES

    1. The general authority citation for part 4 is revised, the 
relevant specific authority citations are revised, and the specific 
authority citation for sections 4.7c and 4.7d is added to read as 
follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1431, 1433, 1434, 1624, 
2071 note; 46 U.S.C. 60105;
* * * * *
    Section 4.7 also issued under 19 U.S.C. 1581(a);
    Section 4.7a also issued under 19 U.S.C. 1498, 1584;
* * * * *
    Sections 4.7c and 4.7d also issued under 6 U.S.C. 943.
* * * * *
    2. Amend Sec.  4.7 by:
    a. Revising paragraph (b)(2); and
    b. In paragraph (e), removing the phrase ``in addition to penalties 
applicable under other provisions of law'' at the end of the first 
sentence and adding in its place the phrase ``in addition to damages 
under the international carrier bond of $5,000 for each violation 
discovered'', and removing the phrase ``, in addition to any other 
penalties applicable under other provisions of law'' at the end of the 
paragraph and adding in its place ``of $5,000 for each violation 
discovered''.
    The revised paragraph (b)(2) reads as follows:

[[Page 109]]

Sec.  4.7  Inward foreign manifest; production on demand; contents and 
form; advance filing of cargo declaration.

* * * * *
    (b) * * *
    (2) In addition to the vessel stow plan requirements pursuant to 
Sec.  4.7c of this part and the container status message requirements 
pursuant to Sec.  4.7d of this part, subject to the effective date 
provided in paragraph (b)(5) of this section, and with the exception of 
any bulk or authorized break bulk cargo as prescribed in paragraph 
(b)(4) of this section, Customs and Border Protection (CBP) must 
receive from the incoming carrier, for any vessel covered under 
paragraph (a) of this section, the CBP-approved electronic equivalent 
of the vessel's Cargo Declaration (Customs Form 1302), 24 hours before 
the cargo is laden aboard the vessel at the foreign port (see Sec.  
4.30(n)(1)). The current approved system for presenting electronic 
cargo declaration information to CBP is the Vessel Automated Manifest 
System (AMS).
* * * * *


Sec.  4.7a  [Amended]

    3. Amend Sec.  4.7a(f) by removing the phrase ``in addition to 
penalties applicable under other provisions of law'' at the end of the 
first sentence and adding in its place ``in addition to damages under 
the international carrier bond of $5,000 for each violation 
discovered'', and removing the phrase ``, in addition to other 
penalties applicable under other provisions of law'' at the end of the 
paragraph and adding in its place ``of $5,000 for each violation 
discovered''.
    4. Add a new Sec.  4.7c, to read as follows:


Sec.  4.7c  Vessel stow plan.

    Vessel stow plan required. In addition to the advance filing 
requirements pursuant to Sec. Sec.  4.7 and 4.7a of this part and the 
container status message requirements pursuant to Sec.  4.7d of this 
part, for all vessels subject to Sec.  4.7(a) of this part, except for 
any vessel exclusively carrying bulk cargo as prescribed in Sec.  
4.7(b)(4) of this part, the incoming carrier must submit a vessel stow 
plan consisting of vessel, container, and break bulk cargo information 
as specified in paragraphs (a)(2) and (3) of this section within the 
time prescribed in paragraph (a)(1) of this section via the CBP-
approved electronic data interchange system.
    (a) Time of transmission. Customs and Border Protection (CBP) must 
receive the stow plan no later than 48 hours after the vessel departs 
from the last foreign port. For voyages less than 48 hours in duration, 
CBP must receive the stow plan prior to arrival at the first U.S. port.
    (b) Vessel information required to be reported. The following 
information must be reported for each vessel:
    (1) Vessel name (including international maritime organization 
(IMO) number);
    (2) Vessel operator; and
    (3) Voyage number.
    (c) Container information required to be reported. The following 
information must be reported for each container and unit of break bulk 
cargo carried on each vessel:
    (1) Container operator, if containerized;
    (2) Equipment number, if containerized;
    (3) Equipment size and type, if containerized;
    (4) Stow position;
    (5) Hazmat-UN code;
    (6) Port of lading; and
    (7) Port of discharge.
    5. Add a new section 4.7d, to read as follows:


Sec.  4.7d  Container status messages.

    (a) Container status messages required. In addition to the advance 
filing requirements pursuant to Sec. Sec.  4.7 and 4.7a of this part 
and the vessel stow plan requirements pursuant to Sec.  4.7c of this 
part, for all containers laden with cargo destined to arrive within the 
limits of a port in the United States from foreign by vessel, the 
incoming carrier must submit messages regarding the status of the 
events as specified in paragraph (b) of this section if the carrier 
creates or collects a container status message (CSM) in its equipment 
tracking system reporting that event. CSMs must be transmitted to 
Customs and Border Protection (CBP) within the time prescribed in 
paragraph (c) of this section via a CBP-approved electronic data 
interchange system. There is no requirement that a carrier create or 
collect any CSM data under this paragraph that the carrier does not 
otherwise create or collect on its own and maintain in its electronic 
equipment tracking system.
    (b) Events required to be reported. The following events must be 
reported if the carrier creates or collects a container status message 
in its equipment tracking system reporting that event:
    (1) When the booking relating to a container which is destined to 
arrive within the limits of a port in the United States by vessel is 
confirmed;
    (2) When a container which is destined to arrive within the limits 
of a port in the United States by vessel undergoes a terminal gate 
inspection;
    (3) When a container, which is destined to arrive within the limits 
of a port in the United States by vessel, arrives or departs a facility 
(These events take place when a container enters or exits a port, 
container yard, or other facility. Generally, these CSMs are referred 
to as ``gate-in'' and ``gate-out'' messages.);
    (4) When a container, which is destined to arrive within the limits 
of a port in the United States by vessel, is loaded on or unloaded from 
a conveyance (This includes vessel, feeder vessel, barge, rail and 
truck movements. Generally, these CSMs are referred to as ``loaded on'' 
and ``unloaded from'' messages);
    (5) When a vessel transporting a container, which is destined to 
arrive within the limits of a port in the United States by vessel, 
departs from or arrives at a port (These events are commonly referred 
to as ``vessel departure'' and ``vessel arrival'' notices);
    (6) When a container which is destined to arrive within the limits 
of a port in the United States by vessel undergoes an intra-terminal 
movement;
    (7) When a container which is destined to arrive within the limits 
of a port in the United States by vessel is ordered stuffed or 
stripped;
    (8) When a container which is destined to arrive within the limits 
of a port in the United States by vessel is confirmed stuffed or 
stripped; and
    (9) When a container which is destined to arrive within the limits 
of a port in the United States by vessel is shopped for heavy repair.
    (c) Time of transmission. For each event specified in paragraph (b) 
of this section that has occurred, and for which the carrier creates or 
collects a container status message (CSM) in its equipment tracking 
system reporting that event, the carrier must transmit the CSM to CBP 
no later than 24 hours after the CSM is entered into the equipment 
tracking system.
    (d) Contents of report. The report of each event must include the 
following:
    (1) Event code being reported, as defined in the ANSI X.12 or UN 
EDIFACT standards;
    (2) Container number;
    (3) Date and time of the event being reported;
    (4) Status of the container (empty or full);
    (5) Location where the event took place; and
    (6) Vessel identification associated with the message.
    (e) Additional container status messages. A carrier may transmit 
other container status messages in addition to those required pursuant 
to paragraph (b)

[[Page 110]]

of this section. By transmitting additional container status messages, 
the carrier authorizes Customs and Border Protection (CBP) to access 
and use that data.

PART 12--SPECIAL CLASSES OF MERCHANDISE

    6. The general authority citation for part 12 and specific 
authority citation for Sec.  12.3 continue to read as follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 (General Note 3(i), 
Harmonized Tariff Schedule of the United States (HTSUS)), 1624;
* * * * *
    Section 12.3 also issued under 7 U.S.C. 135h, 21 U.S.C. 381;
* * * * *


Sec.  12.3  [Amended]

    7. Amend Sec.  12.3(b)(2) and (c) by removing references to ``Sec.  
113.62(l)(1)'' and adding in their place ``Sec.  113.62(m)(1)''.

PART 18--VESSELS IN FOREIGN AND DOMESTIC TRADES

    8. The general authority citation for part 18 continues to read as 
follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 (General Note 3(i), 
Harmonized Tariff Schedule of the United States), 1551, 1552, 1553, 
1623, 1624;
* * * * *
    9. Amend Sec.  18.5 by:
    a. In paragraph (a), removing the reference to ``paragraphs (c), 
(d), (e) and (f)'' and adding in its place ``paragraphs (c), (d), (e), 
(f), and (g)''; and
    b. Adding a new paragraph (g).
    The new paragraph (g) reads as follows:


Sec.  18.5  Diversion.

* * * * *
    (g) For in-bond shipments which, at the time of transmission of the 
Importer Security Filing as required by Sec.  149.2 of this chapter, 
are intended to be entered as an immediate exportation (IE) or 
transportation and exportation (T&E) shipment, permission to divert the 
in-bond movement to a port other than the listed port of destination or 
export or to change the in-bond entry into a consumption entry must be 
obtained from the port director of the port of origin. Such permission 
would only be granted upon receipt by Customs and Border Protection 
(CBP) of a complete Importer Security Filing as required by part 149 of 
this chapter.

PART 103--AVAILABILITY OF INFORMATION

    10. The general authority citation for part 103 continues, and the 
specific authority citation for Sec.  103.31a is revised to read as 
follows:

    Authority: 5 U.S.C. 301, 552, 552a; 19 U.S.C. 66, 1624; 31 
U.S.C. 9701.
* * * * *
    Section 103.31a also issued under 19 U.S.C. 2071 note and 6 
U.S.C. 943;
* * * * *
    11. Revise Sec.  103.31a to read as follows:


Sec.  103.31a  Advance electronic information for air, truck, and rail 
cargo; Importer Security Filing information for vessel cargo.

    The following types of advance electronic information are per se 
exempt from disclosure under Sec.  103.12(d), unless CBP receives a 
specific request for such records pursuant to Sec.  103.5, and the 
owner of the information expressly agrees in writing to its release:
    (a) Advance cargo information that is electronically presented to 
Customs and Border Protection (CBP) for inbound or outbound air, rail, 
or truck cargo in accordance with Sec.  122.48a, 123.91, 123.92, or 
192.14 of this chapter;
    (b) Importer Security Filing information that is electronically 
presented to CBP for inbound vessel cargo in accordance with Sec.  
149.2 of this chapter;
    (c) Vessel stow plan information that is electronically presented 
to CBP for inbound vessels in accordance with Sec.  4.7c of this 
chapter; and
    (d) Container status message information that is electronically 
presented for inbound containers in accordance with Sec.  4.7d of this 
chapter.

PART 113--CUSTOMS BONDS

    12. The general authority citation for part 113 continues to read 
as follows:

    Authority: 19 U.S.C. 66, 1623, 1624.
* * * * *
    13. Amend Sec.  113.62 by:
    a. Redesignating paragraphs (j) through (l) as paragraphs (k) 
through (m);
    b. Adding new paragraph (j);
    c. In redesignated paragraph (k)(2), removing the phrase ``$5,000 
for each regulation violated'' and adding in its place ``$5,000 for 
each violation''.
    d. In newly designated paragraph (m)(1), removing the reference to 
``paragraphs (a), (g), (i), (j)(2), or (k)'' and adding in its place 
``paragraphs (a), (g), (i), (j), (k)(2), or (l)'';
    e. In newly designated paragraph (m)(4), removing the reference to 
``paragraph (l)(1)'' and adding in its place ``paragraph (m)(1)''; and
    f. In newly designated paragraph (m)(5), removing the reference to 
``paragraph (k)'' and adding in its place ``paragraph (l)''.
    The new paragraph (j) reads as follows:


Sec.  113.62  Basic importation and entry bond conditions.

* * * * *
    (j) The principal agrees to comply with all Importer Security 
Filing requirements set forth in part 149 of this chapter including but 
not limited to providing security filing information to Customs and 
Border Protection in the manner and in the time period prescribed by 
regulation. If the principal defaults with regard to any obligation, 
the principal and surety (jointly and severally) agree to pay 
liquidated damages equal to the value of the merchandise involved in 
the default.
* * * * *
    14. Amend Sec.  113.64 by:
    a. Redesignating paragraphs (d) through (g) as paragraphs (h) 
through (k);
    b. Redesignating paragraph (c) as paragraph (d);
    c. Adding new paragraphs (c), (e), (f), and (g); and
    d. In redesignated paragraph (d), removing the phrase ``$5,000 for 
each regulation violated'' and adding in its place ``$5,000 for each 
violation''.
    New paragraphs (c), (e), (f), and (g) read as follows:


Sec.  113.64  International carrier bond conditions.

* * * * *
    (c) Agreement to provide advance cargo information. The incoming 
carrier agrees to provide advance cargo information to CBP in the 
manner and in the time period required under Sec. Sec.  4.7 and 4.7a of 
this chapter. If the incoming carrier, as principal, defaults with 
regard to these obligations, the principal and surety (jointly and 
severally) agree to pay liquidated damages of $5,000 for each 
violation, to a maximum of $100,000 per conveyance arrival.
* * * * *
    (e) Agreement to comply with Importer Security Filing requirements. 
If the principal elects to provide the Importer Security Filing 
information to Customs and Border Protection (CBP), the principal 
agrees to comply with all Importer Security Filing requirements set 
forth in part 149 of this chapter including but not limited to 
providing security filing information to CBP in the manner and in the 
time period prescribed by regulation. If the principal defaults with 
regard to any obligation, the principal and surety (jointly and 
severally) agree to pay liquidated damages equal to the value of the 
merchandise involved in the default.

[[Page 111]]

    (f) Agreement to comply with vessel stow plan requirements. If the 
principal causes a vessel to arrive within the limits of a port in the 
United States, the principal agrees to submit a stow plan in the manner 
and in the time period required pursuant to part 4.7c of this chapter. 
If the principal defaults with regard to this obligation, the principal 
and surety (jointly and severally) agree to pay liquidated damages of 
$50,000 for each vessel arrival.
    (g) Agreement to comply with container status message requirements. 
If the principal causes a vessel to arrive within the limits of a port 
in the United States, the principal agrees to submit container status 
messages in the manner and in the time period required pursuant to part 
4.7d of this chapter. If the principal defaults with regard to these 
obligations, the principal and surety (jointly and severally) agree to 
pay liquidated damages of $5,000 for each violation, to a maximum of 
$100,000 per vessel arrival.
* * * * *
    15. Amend Sec.  113.73 by:
    a. Redesignating existing paragraphs (c) and (d) as paragraphs (d) 
and (e); and
    b. Adding a new paragraph (c).
    The new paragraph (c) reads as follows:


Sec.  113.73  Foreign trade zone operator bond conditions.

* * * * *
    (c) Agreement to comply with Importer Security Filing requirements. 
The principal agrees to comply with all Importer Security Filing 
requirements set forth in part 149 of this chapter including but not 
limited to providing security filing information to Customs and Border 
Protection (CBP) in the manner and in the time period prescribed by 
regulation. If the principal defaults with regard to any obligation, 
the principal and surety (jointly and severally) agree to pay 
liquidated damages equal to the value of the merchandise involved in 
the default.
* * * * *

PART 122--AIR COMMERCE REGULATIONS

    16. The general authority citation for part 122 continues to read 
as follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 58b, 66, 1431, 1433, 1436, 
1448, 1459, 1590, 1594, 1623, 1624, 1644, 1644a, 2071 note.
* * * * *


Sec.  122.48a  [Amended]

    17. Amend Sec.  122.48a(c)(2) by removing the reference to ``Sec.  
113.62(j)(2)'' and adding in its place ``Sec.  113.62(k)(2)''.

PART 123--CUSTOMS RELATIONS WITH CANADA AND MEXICO

    18. The general authority citation for part 123 continues to read 
as follows:

    Authority: 19 U.S.C. 66, 1202 (General Note 3(i), Harmonized 
Tariff Schedule of the United States (HTSUS)), 1431, 1433, 1436, 
1448, 1624, 2071 note.
* * * * *


Sec.  123.92  [Amended]

    19. Amend Sec.  123.92(c)(2) by removing the reference to ``Sec.  
113.62(j)(2)'' and adding in its place ``Sec.  113.62(k)(2)''.

PART 141--ENTRY OF MERCHANDISE

    20. The general authority citation for part 141 and specific 
authority citation for Sec.  141.113 continue to read as follows:

    Authority: 19 U.S.C. 66, 1448, 1484, 1624.
* * * * *
    Section 141.113 also issued under 19 U.S.C. 1499, 1623.


Sec.  141.113  [Amended]

    21. Amend Sec.  141.113(b) by removing the reference to ``Sec.  
113.62(l)(1)'' and adding in its place ``Sec.  113.62(m)(1)''.

PART 143--SPECIAL ENTRY PROCEDURES

    24. The general authority citation for part 143 continues to read 
as follows:

    Authority: 19 U.S.C. 66, 1481, 1484, 1498, 1624.

    25. Revise Sec.  143.1 to read as follows:


Sec.  143.1  Eligibility.

    The Automated Broker Interface (ABI) is a module of the Customs 
Automated Commercial System (ACS) which allows participants to transmit 
data electronically to CBP through ABI and to receive transmissions 
through ACS. Its purposes are to improve administrative efficiency, 
enhance enforcement of customs and related laws, lower costs and 
expedite the release of cargo.
    (a) Participants for entry and entry summary purposes. Participants 
in ABI for the purposes of transmitting data relating to entry and 
entry summary may be:
    (1) Customs brokers as defined in Sec.  111.1 of this chapter;
    (2) Importers as defined in Sec.  101.1 of this chapter; and
    (3) ABI service bureaus, that is, an individual, partnership, 
association or corporation which provides communications facilities and 
data processing services for brokers and importers, but which does not 
engage in the conduct of customs business as defined in Sec.  111.1 of 
this chapter.
    (b) Participants for Importer Security Filing purposes. Any party 
may participate in ABI solely for the purposes of filing the Importer 
Security Filing pursuant to Sec.  149.2 of this chapter if that party 
fulfills the eligibility requirements contained in Sec.  149.5 of this 
chapter. If a party other than a customs broker as defined in Sec.  
111.1 of this chapter or an importer as defined 19 U.S.C. 1484 submits 
the Importer Security Filing, no portion of the Importer Security 
Filing can be used for entry or entry summary purposes pursuant to 
Sec.  149.5 of this chapter.
    (c) Participants for other purposes. Upon approval by CBP, any 
party may participate in ABI for other purposes, including transmission 
of protests, forms relating to in-bond movements (CBP Form 7512), and 
applications for FTZ admission (CBP Form 214).

PART 146--FOREIGN TRADE ZONES

    26. The general authority citation for part 146 continues to read 
as follows:

    Authority: 19 U.S.C. 66, 81a-81u, 1202 (General Note 3(i), 
Harmonized Tariff Schedule of the United States), 1623, 1624.

    27. Amend Sec.  146.32 by:
    a. Removing all references to ``Customs Form 214'' and adding in 
their place ``CBP Form 214'';
    b. Redesignating paragraph (a) as paragraph (a)(1); and
    c. Adding a new paragraph (a)(2).
    The new paragraph (a)(2) reads as follows:


Sec.  146.32  Application and permit for admission of merchandise.

    (a)(1) * * *
    (2) CBP Form 214 and Importer Security Filing submitted via a 
single electronic transmission. If an Importer Security Filing is filed 
pursuant to part 149 of this chapter via the same electronic 
transmission as CBP Form 214, the filer is only required to provide the 
following fields once to be used for Importer Security Filing and CBP 
Form 214 purposes:
    (i) Country of origin; and
    (ii) Commodity HTSUS number if this number is provided at the 10 
digit level.
* * * * *
    28. Add part 149 to chapter I to read as follows:

PART 149--IMPORTER SECURITY FILING

Sec.
149.1 Definitions.
149.2 Importer security filing--requirement, time of transmission, 
verification of information, update, withdrawal.
149.3 Data elements.

[[Page 112]]

149.4 Bulk and break bulk cargo.
149.5 Authorized agents.
149.6 Entry and/or entry summary documentation and Importer Security 
Filing submitted via a single electronic transmission.

    Authority: 5 U.S.C. 301; 6 U.S.C. 943; 19 U.S.C. 66, 1624, 2071 
note.


Sec.  149.1  Definitions.

    (a) Importer. For purposes of this part, ``importer'' means the 
party causing goods to arrive within the limits of a port in the United 
States. For foreign cargo remaining on board (FROB), the importer is 
construed as the carrier. For immediate exportation (IE) and 
transportation and exportation (T&E) in-bond shipments, and goods to be 
delivered to a foreign trade zone (FTZ), the importer is construed as 
the party filing the IE, T&E, or FTZ documentation.
    (b) Importation. For purpose of this part, ``importation'' means 
the point at which cargo arrives within the limits of a port in the 
United States.
    (c) Bulk cargo. For purposes of this part, ``bulk cargo'' is 
defined as homogeneous cargo that is stowed loose in the hold and is 
not enclosed in any container such as a box, bale, bag, cask, or the 
like. Such cargo is also described as bulk freight. Specifically, bulk 
cargo is composed of either:
    (1) Free flowing articles such as oil, grain, coal, ore, and the 
like, which can be pumped or run through a chute or handled by dumping; 
or
    (2) Articles that require mechanical handling such as bricks, pig 
iron, lumber, steel beams, and the like.
    (d) Break bulk cargo. For purposes of this part, ``break bulk 
cargo'' is defined as cargo that is not containerized, but which is 
otherwise packaged or bundled.


Sec.  149.2  Importer security filing--requirement, time of 
transmission, verification of information, update, withdrawal.

    (a) Importer security filing required. With the exception of any 
bulk cargo pursuant to Sec.  149.4(a) of this part, the importer, as 
defined in Sec.  149.1 of this part, or authorized agent (see Sec.  
149.5 of this part) must submit in English the Importer Security Filing 
elements prescribed in Sec.  149.3 of this part within the time 
specified in paragraph (b) of this section via a CBP-approved 
electronic interchange system.
    (b) Time of transmission. With the exception of any break bulk 
cargo pursuant to Sec.  149.4(b) of this part and foreign cargo 
remaining on board (FROB), CBP must receive the Importer Security 
Filing no later than 24 hours before the cargo is laden aboard the 
vessel at the foreign port. For FROB, CBP must receive the Importer 
Security Filing prior to lading aboard the vessel at the foreign port.
    (c) Verification of information. Where the party electronically 
presenting to CBP the Importer Security Filing required in paragraph 
(a) of this section receives any of this information from another 
party, CBP will take into consideration how, in accordance with 
ordinary commercial practices, the presenting party acquired such 
information, and whether and how the presenting party is able to verify 
this information. Where the presenting party is not reasonably able to 
verify such information, CBP will permit the party to electronically 
present the information on the basis of what the party reasonably 
believes to be true.
    (d) Update of Importer Security Filing. The party who submitted the 
Importer Security Filing pursuant to paragraph (a) of this section must 
update the filing if, after the filing is submitted and before the 
goods enter the limits of a port in the United States, any of the 
information submitted changes or more accurate information becomes 
available.
    (e) Withdrawal of Importer Security Filing. If, after an Importer 
Security Filing is submitted pursuant to paragraph (a) of this section, 
the goods associated with the Importer Security Filing are no longer 
intended to be imported to the United States, the party who submitted 
the Importer Security Filing must withdraw the Importer Security Filing 
and transmit to CBP the reason for such withdrawal.


Sec.  149.3  Data elements.

    (a) Shipments intended to be entered into the United States and 
shipments intended to be delivered to a foreign trade zone. Except as 
otherwise provided for in paragraph (b) of this section, the following 
elements must be provided for each good listed at the 6 digit HTSUS 
number at the lowest bill of lading level (i.e., at the house bill of 
lading level, if applicable). The manufacturer (or supplier) name and 
address, country of origin, and commodity HTSUS number must be linked 
to one another at the line item level.
    (1) Manufacturer (or supplier) name and address. Name and address 
of the entity that last manufactures, assembles, produces, or grows the 
commodity or name and address of the supplier of the finished goods in 
the country from which the goods are leaving. In the alternative the 
name and address of the manufacturer (or supplier) that is currently 
required by the import laws, rules and regulations of the United States 
(i.e., entry procedures) may be provided (this is the information that 
is used to create the existing manufacturer identification (MID) number 
for entry purposes).
    (2) Seller name and address. Name and address of the last known 
entity by whom the goods are sold or agreed to be sold. If the goods 
are to be imported otherwise than in pursuance of a purchase, the name 
and address of the owner of the goods must be provided.
    (3) Buyer name and address. Name and address of the last known 
entity to whom the goods are sold or agreed to be sold. If the goods 
are to be imported otherwise than in pursuance of a purchase, the name 
and address of the owner of the goods must be provided.
    (4) Ship to name and address. Name and address of the first 
deliver-to party scheduled to physically receive the goods after the 
goods have been released from customs custody.
    (5) Container stuffing location. Name and address(es) of the 
physical location(s) where the goods were stuffed into the container. 
For break bulk shipments, as defined in Sec.  149.1 of this part, the 
name and address(es) of the physical location(s) where the goods were 
made ``ship ready'' must be provided.
    (6) Consolidator (stuffer) name and address. Name and address of 
the party who stuffed the container or arranged for the stuffing of the 
container. For break bulk shipments, as defined in Sec.  149.1 of this 
part, the name and address of the party who made the goods ``ship 
ready'' or the party who arranged for the goods to be made ``ship 
ready'' must be provided.
    (7) Importer of record number/Foreign trade zone applicant 
identification number. Internal Revenue Service (IRS) number, Employer 
Identification Number (EIN), Social Security Number (SSN), or CBP 
assigned number of the entity liable for payment of all duties and 
responsible for meeting all statutory and regulatory requirements 
incurred as a result of importation. For goods intended to be delivered 
to a foreign trade zone (FTZ), the IRS number, EIN, SSN, or CBP 
assigned number of the party filing the FTZ documentation with CBP must 
be provided.
    (8) Consignee number(s). Internal Revenue Service (IRS) number, 
Employer Identification Number (EIN), Social Security Number (SSN), or 
CBP assigned number of the individual(s) or firm(s) in the United 
States on whose account the merchandise is shipped.
    (9) Country of origin. Country of manufacture, production, or 
growth of the article, based upon the import laws,

[[Page 113]]

rules and regulations of the United States.
    (10) Commodity HTSUS number. Duty/statistical reporting number 
under which the article is classified in the Harmonized Tariff Schedule 
of the United States (HTSUS). The HTSUS number must be provided to the 
6 digit level. The HTSUS number may be provided up to the 10 digit 
level. This element can only be used for entry purposes if it is 
provided at the 10 digit level or greater by the importer of record or 
its licensed customs broker.
    (b) FROB, IE shipments, and T&E shipments. For shipments consisting 
entirely of foreign cargo remaining on board (FROB) and shipments 
intended to be transported in-bond as an immediate exportation (IE) or 
transportation and exportation (T&E), the following elements must be 
provided for each good listed at the 6 digit HTSUS number at the lowest 
bill of lading level (i.e., at the house bill of lading level, if 
applicable).
    (1) Booking party name and address. Name and address of the party 
who is paying for the transportation of the goods.
    (2) Foreign port of unlading. Port code for the foreign port of 
unlading at the intended final destination.
    (3) Place of delivery. City code for the place of delivery.
    (4) Ship to name and address. Name and address of the first 
deliver-to party scheduled to physically receive the goods after the 
goods have been released from customs custody.
    (5) Commodity HTSUS number. Duty/statistical reporting number under 
which the article is classified in the Harmonized Tariff Schedule of 
the United States (HTSUS). The HTSUS number must be provided to the 6 
digit level. The HTSUS number may be provided to the 10 digit level.


Sec.  149.4  Bulk and break bulk cargo.

    (a) Bulk cargo exempted from filing requirement. For bulk cargo 
that is exempt from the requirement set forth in Sec.  4.7(b)(2) of 
this chapter that a cargo declaration be filed with Customs and Border 
Protection (CBP) 24 hours before such cargo is laden aboard the vessel 
at the foreign port, importers, as defined in Sec.  149.1 of this part, 
of bulk cargo are also exempt from filing an Importer Security Filing 
with respect to that cargo.
    (b) Break bulk cargo exempted from time requirement. For break bulk 
cargo that is exempt from the requirement set forth in Sec.  4.7(b)(2) 
of this chapter for carriers to file a cargo declaration with Customs 
and Border Protection (CBP) 24 hours before such cargo is laden aboard 
the vessel at the foreign port, importers, as defined in Sec.  149.1 of 
this part, of break bulk cargo are also exempt with respect to that 
cargo from the requirement set forth in Sec.  149.2 of this part to 
file an Importer Security Filing with CBP 24 hours before such cargo is 
laden aboard the vessel at the foreign port. Any importers of break 
bulk cargo that are exempted from the filing requirement of Sec.  149.2 
of this part must present the Importer Security Filing to CBP 24 hours 
prior to the cargo's arrival in the United States. These importers must 
still report 24 hours in advance of loading any containerized or non-
qualifying break bulk cargo they will be importing.


Sec.  149.5  Authorized agents.

    (a) Eligibility. To be qualified to file Importer Security Filing 
information electronically, a party must establish the communication 
protocol required by Customs and Border Protection for properly 
presenting the Importer Security Filing through the approved data 
interchange system. If the Importer Security Filing and entry or entry 
summary are provided via a single electronic transmission to CBP 
pursuant to Sec.  149.6(b) of this part, the party making the 
transmission must be an importer acting on its own behalf or a licensed 
customs broker. Also, any Importer Security Filing filer must possess a 
basic importation and entry bond containing all the necessary 
provisions of Sec.  113.62 of this chapter, an international carrier 
bond containing all the necessary provisions of Sec.  113.64 of this 
chapter, or a foreign trade zone operator bond containing all the 
necessary provisions of Sec.  113.73 of this chapter.
    (b) Powers of attorney. Authorized agents must retain powers of 
attorney and make them available to representatives of Customs and 
Border Protection upon request.


Sec.  149.6  Entry and/or entry summary documentation and Importer 
Security Filing submitted via a single electronic transmission.

    If the Importer Security Filing is filed pursuant to Sec.  149.2 of 
this part via the same electronic transmission as entry and/or entry 
summary documentation pursuant to Sec.  142.3 of this chapter, the 
importer is only required to provide the following fields once to be 
used for Importer Security Filing, entry, and/or entry summary 
purposes, as applicable:
    (a) Importer of record number;
    (b) Consignee number;
    (c) Country of origin; and
    (d) Commodity HTSUS number if this number is provided at the 10 
digit level.

PART 192--EXPORT CONTROL

    29. The general authority citation for part 192 continues to read 
as follows:

    Authority: 19 U.S.C. 66, 1624, 1646c. Subpart A also issued 
under 19 U.S.C. 1627a, 1646a, 1646b; subpart B also issued under 13 
U.S.C. 303; 19 U.S.C. 2071 note; 46 U.S.C. 91.


Sec.  192.14  [Amended]

    29. Amend Sec.  192.14(c)(4)(ii) by removing the reference to 
``Sec.  113.64(g)(2)'' and adding in its place ``Sec.  113.64(k)(2)''.

    Dated: December 14, 2007.
W. Ralph Basham,
Commissioner, Customs and Border Protection.
    Approved:
    Dated: December 21, 2007.
Michael Chertoff,
Secretary.
[FR Doc. E7-25306 Filed 12-31-07; 8:45 am]
BILLING CODE 9111-14-P