[Federal Register Volume 73, Number 210 (Wednesday, October 29, 2008)]
[Notices]
[Pages 64356-64358]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-25551]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection


Importer Self-Assessment Product Safety Pilot

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

ACTION: General notice.

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SUMMARY: This document announces the expansion of the Importer Self-
Assessment Program (ISA) to include the Importer Self-Assessment-
Product Safety Pilot (ISA-PS). The ISA-PS is a partnership that will be 
created among CBP, the Consumer Product Safety Commission (CPSC), and 
importers which will strive to maintain a high level of product safety 
compliance, and to achieve the goals of the Interagency Working Group 
on Import Safety by working collaboratively to prevent unsafe imports. 
The ISA-PS is a voluntary approach to product safety compliance, which 
will provide recognition and support to participating companies. 
Application to the ISA-PS is open to all importers who are participants 
in the ISA. CBP and CPSC staff will designate a limited number of 
importers from the initial applicants and determine their eligibility 
for participation in the pilot program. This document contains 
information on the application process, the benefits, and continued 
participation requirements.

DATES: Effective Date: This pilot program will be open to applications 
from qualified importers on October 29, 2008.

FOR FURTHER INFORMATION CONTACT: Cathy Sauceda, Director, Import Safety 
and Interagency Requirements Division, Office of International Trade, 
Customs and Border Protection, (202) 863-6556.

SUPPLEMENTARY INFORMATION: 

Background

ISA Program

    U.S. Customs and Border Protection (CBP) is committed to 
encouraging importers to share the responsibility for compliance with 
trade laws and regulations. In order to enable interested importers to 
participate in a program that allows them to assess their own 
compliance with CBP laws and regulations on a continuing basis, CBP 
(then known as the U.S. Customs Service, Department of the Treasury) 
announced the Importer Self-Assessment (ISA) program on June 17, 2002 
in a notice in the Federal Register (67 FR 41298). The ISA program is a 
trade facilitation partnership program that recruits trade compliant 
companies in order to reduce both CBP and company resources required 
during entry and post entry, and to build cooperative relationships 
that strengthen trade compliance with trade laws. The ISA program is 
based on the premise that importers with strong internal controls 
achieve the highest level of compliance with CBP laws and regulations, 
and provides a means to recognize and support importers that have 
implemented such systems.
    Since the ISA program started in 2002, over 172 importers under 760 
different Importer of Record numbers have been approved to participate 
in the program. The compliance measurement program has shown that ISA 
program participants have continued to hold the highest rate of 
compliance with major trade laws among major importing groups. In FY 
2007, merchandise imported by ISA participants comprised 15% of the 
total value imported into the United States and the compliance rate for 
ISA importers was 99.4%.

Import Safety

    On July 18, 2007, President George W. Bush issued Executive Order 
13439, which established an Interagency Working Group on Import Safety 
(``Working Group''). The Working Group, a cabinet-level panel of 
designated members, includes CBP (acting as a designee of the Secretary 
of Homeland Security) and the Chairman of the U.S. Consumer Product 
Safety Commission (CPSC). The mission of the Working Group is to 
identify actions and appropriate steps that can be pursued, within 
existing resources, to

[[Page 64357]]

promote the safety of imported products by (i) Reviewing and assessing 
current import safety procedures and methods aimed at ensuring the 
safety of imported products, (ii) identifying potential means to 
promote all appropriate steps by U.S. importers to enhance safety of 
imported products, and (iii) surveying the authorities and practices of 
Federal, State, and local government agencies regarding the safety of 
imports to identify best practices and enhance coordination among 
agencies. Executive Order 13439 required the Working Group to provide 
recommendations within 60 days to the President regarding these actions 
and steps.
    On September 10, 2007, the Working Group submitted a comprehensive 
strategic framework entitled Protecting Americans Every Step of the 
Way: A strategic framework for continual improvement in import safety 
(``Strategic Framework''), which outlined an approach that can build 
upon existing efforts to improve the safety of imported products, while 
facilitating trade. On November 6, 2007, the Working Group followed the 
submission of the Strategic Framework by presenting an Action Plan for 
Import Safety: A roadmap for continual improvement (``Action Plan''). 
The Action Plan takes the form of 14 broad recommendations and 50 
specific action steps based on the Strategic Framework.
    Three organizing principles form the keystones of the Strategic 
Framework and the Action Plan recommendations: (i) Preventing harm 
resulting from the importation of unsafe products; (ii) intervening 
when risks are identified; and, (iii) responding rapidly after harm has 
occurred. Within each of these organizing principles are cross-cutting 
building blocks that departments and agencies should use to guide their 
programs. These ``building blocks'' include the advancement of a common 
vision across the federal government, as well as fostering a culture of 
collaboration among federal departments and agencies.
    CBP is responsible for multiple action steps in the Action Plan, 
including harmonizing government procedures concerning imports, 
creating an automated system reflecting a ``single window'' concept, 
and being an active participant in establishing good importer practices 
for foreign collaboration, capacity building and developing voluntary 
certification programs. Taking the lead for a significant amount of the 
action steps, CBP leads the Working Group in its mission to implement 
the Action Plan and Strategic Framework by working collaboratively with 
other government agencies and focusing on import safety issues.
    The Working Group is comprised of multiple government agencies, 
including CPSC. CBP and CPSC have a strong history of partnership in 
combating unsafe imports, and the two agencies have worked diligently 
on several significant product recalls including those on lead in toys, 
cribs, and children's sleepwear. This collaboration has strengthened as 
both agencies have worked together in the Working Group to implement 
the Action Plan and the Strategic Framework. In November of 2007, CBP 
officials worked closely with CPSC officials to formulate a response to 
the recall of the toy Aquadots after it was discovered that some of the 
imported toys contained a toxic chemical that resulted in the illness 
and hospitalization of some children who ingested the toys. The two 
agencies devised a plan to seize and recover shipments of Aquadots 
bound for the U.S. or that were already in the U.S. and still subject 
to redelivery, and thereby successfully prevented the unsafe toys from 
further distribution.
    Currently, to more precisely target consumer products that present 
a safety risk, CPSC staff and CBP are collaborating on action steps to 
further improve import safety. CBP and CPSC staff are working 
collectively with the trade community in the development of a 
trilateral partnership to facilitate the trade of safe products. Since 
the development of the ISA program, CBP and CPSC staff have worked with 
the Departmental Advisory Committee on Commercial Operations of Customs 
and Border Protection and Related Homeland Security Functions (COAC) to 
expand the ISA program to include a product safety component, and 
thereby extend the ISA program to include compliance with other agency 
requirements.

Expansion of ISA Program To Include Import Safety

    In order to further the goals of the Working Group's Strategic 
Framework and Action Plan, this document announces the expansion of the 
ISA to include the Importer Self-Assessment-Product Safety Pilot (ISA-
PS). The ISA-PS is envisioned to be a partnership among CBP, CPSC, and 
importers to maintain a high level of product safety compliance, and to 
thereby achieve the objective of the Strategic Framework and Action 
Plan, that is, working collaboratively to prevent unsafe imports. The 
ISA-PS is a voluntary approach to product safety compliance, which 
provides recognition and support to participating companies. CBP and 
CPSC staff have developed a list of best practices to ensure compliance 
with CPSC's current regulations and will be working through this 
program to adapt those best practices to meet CPSC's new statutory 
scheme. Within the realm of their respective authorities, CBP and CPSC 
will verify that companies have adequate controls and processes in 
place to ensure product safety at all points in the product life-cycle 
of imported products and to comply with these mandatory standards. CPSC 
staff and CBP have worked to develop CPSC-based benefits to encourage 
participation in this expanded pilot program. Acceptance into the 
program is by mutual agreement of CPSC and CBP.

Description of the Importer Self-Assessment Product Safety Pilot

Overview

    The Importer Self-Assessment-Product Safety Pilot (ISA-PS) is 
envisioned to be a partnership among CBP, the Consumer Product Safety 
Commission (CPSC) and importers to maintain a high level of product 
safety compliance. ISA-PS is a voluntary approach to product safety 
compliance, which provides recognition and support to participating 
companies.

ISA-PS Participation Requirements

    In order to participate in ISA-PS, an importer must:
    1. Be an active member in ISA and comply with all ISA requirements 
and obligations.
    2. Complete an ISA-PS/CPSC Questionnaire and sign an ISA-PS/CPSC 
Addendum.
    3. Agree to comply with all laws and regulations administered by 
CBP, as well as the CPSC including, but not limited to: the Consumer 
Product Safety Improvement Act of 2008, Public Law 110-314, 122 Stat. 
3016 (August 14, 2008), the Consumer Product Safety Act (codified at 15 
U.S.C. 2051-2089), the Federal Hazardous Substances Act (codified at 15 
U.S.C. 1261-1278), the Flammable Fabrics Act (codified at 15 U.S.C. 
1191-1204), the Poison Prevention Packaging Act (codified at 15 U.S.C. 
1471-1476), the Refrigerator Safety Act (codified at 15 U.S.C. 1211-
1214), the Virginia Graeme Baker Pool and Spa Safety Act (codified at 
15 U.S.C. 8001-8008), and the Children's Gasoline Burn Prevention Act, 
Public Law 110-278, 122 Stat. 2602 (July 17, 2008).
    4. Maintain an internal control system that ensures the integrity 
of product safety.

[[Page 64358]]

    5. Notify CBP of any major organizational changes that may impact 
the importer's product safety controls.
    6. Submit an annual written notification to CBP that sets forth the 
importer's ISA-PS point of contact and acknowledges that the importer 
continues to meet the requirements of ISA-PS.

Application Process

1. Required Information
    Interested applicants (importers that are already active members of 
ISA) may send an e-mail requesting an application to [email protected], and 
will receive an electronic ISA-PS/CPSC Questionnaire and an ISA-PS/CPSC 
Addendum. Completed ISA-PS/CPSC Questionnaires may be submitted 
electronically via e-mail to [email protected].
2. CBP Review of Application
    After the applicant has submitted the ISA-PS/CPSC Questionnaire and 
ISA-PS/CPSC Addendum, CBP and CPSC staff will review the applicant's 
submission. For a limited number of applicants, the review will include 
a CPSC risk assessment to determine the applicant's readiness to assume 
responsibilities for self-assessment. The risk assessment will include 
an examination of the applicant as identified by the Importer of Record 
(IOR) number(s) listed on the ISA-PS/CPSC Questionnaire and its scope 
will include the laws and regulations administered by CPSC requirements 
set forth above (in ISA-PS Participation Requirements, Item 3). CBP and 
CPSC will perform a formal domestic site visit with the importer. At 
the discretion of CBP and CPSC it may also be necessary to perform a 
formal visit with the applicant at a foreign facility. The purpose of 
these site visits is to determine if the applicant is ready to assume 
the responsibilities of self-assessment and to equip CBP and CPSC with 
the knowledge of the importers internal control procedures as 
appropriate. If CBP and CPSC determine that the applicant is not ready 
to assume the responsibilities of self-assessment, CBP and CPSC staff 
will continue to work with the applicant to strengthen their product 
safety program. If CBP and CPSC staff determine that the applicant is 
ready to assume all the responsibilities of self-assessment, they will 
sign the ISA-PS/CPSC Addendum and return a copy to the importer. CBP 
and CPSC staff reserve the right, in their discretion, to approve or 
disapprove an application. Further, in selecting applicants for 
participation in ISA-PS, CBP and CPSC staff reserve the right to 
establish priorities for the processing and approval of applications.

ISA-PS Potential Benefits

    In addition to the benefits received as a participant in ISA, once 
accepted into the ISA-PS, the participant also becomes eligible for the 
following benefits:
    1. CPSC will provide the participant with a product-specific CPSC 
point of contact who can assist in providing National Electronic Injury 
Surveillance System (NEISS) Product Codes for entry lines.
    2. CPSC will provide access to the participant with special 
training concerning product safety compliance, internal controls, and 
CPSC audit trails.
    3. CPSC will allow the participant the opportunity to apply for 
external participation coverage of multiple business units (multiple 
IOR numbers) identified in the ISA-PS/CPSC Addendum.
    4. CPSC will consider expansion of benefits to all products of 
approved participants if the entry line(s) contains all the applicable 
NEISS product code(s).
    5. CPSC will reduce product safety tests on goods imported by ISA-
PS participants.
    6. CPSC laboratories will grant priority ``front of the line 
testing'' to ISA-PS participants when product safety testing is 
conducted.
    7. CPSC may allow products to be destroyed by the ISA-PS 
participant in lieu of requesting redelivery to CBP of the product.
    8. CPSC will acknowledge the participation of ISA-PS in CPSC's 
``Fast-Track Product Recall Program.''
    9. Additional benefits tailored to specific industry needs may 
later become available.
    Additionally, the ISA-PS participant will enjoy greater business 
certainty because a reliable system of internal controls ensures 
compliant product safety transactions.

ISA-PS Continuing Participation Requirements

    Each ISA-PS participant must remain an active member in ISA and 
comply with all ISA requirements and obligations, available at http://www.cbp.gov/linkhandler/cgov/trade/trade_programs/trade_compliance/importer_self_assessment/isahb.ctt/isahb.doc. Additionally, each ISA-
PS participant must remain in compliance with the requirements of the 
ISA-PS/CPSC Addendum and provide annual written notification to CBP 
that it continues to meet the requirements of ISA-PS. In connection 
with this notification, CBP and CPSC staff will determine if additional 
discussions or reviews of company controls or documentation are 
necessary. In addition, ISA-PS participants are responsible for making 
appropriate ongoing changes to internal controls as needed.
    If a participant fails to remain an active member in ISA or fails 
to meet the requirements of the ISA-PS/CPSC Addendum, or is determined 
to have violated a law or regulation administered by CBP or the CPSC, 
the participant may be subject to penalties, liquidated damages, and/or 
removal from the ISA removal from the ISA-PS. If CBP and CPSC staff 
believe that there is a basis for removal of an ISA-PS participant, a 
written notice proposing removal with a description of the facts or 
conduct warranting removal, will be provided to such participant. The 
participant will be offered the opportunity to respond to the proposed 
removal notice within 30 days of the date of the notice. CBP and CPSC 
will issue a final written decision on the proposed removal within 30 
days of the receipt of the response to the proposed removal notice, if 
one was timely received. In the case of a public health interest and/or 
safety concern, a participant may be removed immediately from the ISA-
PS. The participant will be given an opportunity to respond within 30 
days to the notice providing for immediate removal.

Evaluation of Pilot

    CBP and CPSC staff intend to review the ISA-PS pilot two years 
after its effective date to measure its effects and achievements, and 
recommend to CBP and the Commission whether ISA-PS shall become a 
permanent program.

    Dated: October 21, 2008.
Jayson P. Ahern,
Acting Commissioner, Customs and Border Protection.
 [FR Doc. E8-25551 Filed 10-28-08; 8:45 am]
BILLING CODE 9111-14-P