[Federal Register Volume 76, Number 232 (Friday, December 2, 2011)]
[Notices]
[Pages 75553-75554]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-31009]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection


Completion of the Broker Self-Assessment Outreach Pilot

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

ACTION: General notice.

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SUMMARY: This document announces the completion of the Broker Self-
Assessment (BSA) Outreach Pilot (BSA Pilot), a voluntary partnership 
with the customs brokerage community, which began in July 2009. CBP has 
decided to end the BSA pilot without a plan to proceed with another 
Importer Self-Assessment type model. CBP and the National Customs 
Brokers and Forwarders Association of America (NCBFAA) have agreed to 
pursue other avenues to collaborate pertaining to trade modernization 
efforts.

DATES: Effective Date: December 2, 2011.

FOR FURTHER INFORMATION CONTACT: Florence Constant, Partnership 
Programs Branch, Trade Policy and Programs, Office of International 
Trade, Tel.: (202) 863-6537.

SUPPLEMENTARY INFORMATION: 

Background

    This document announces the completion of the Broker Self-
Assessment Outreach Pilot (BSA Pilot), which began July 2009 after its 
announcement in the Federal Register (74 FR 19103) on April 27, 2009. 
The pilot was a collaborative effort by U.S. Customs and Border 
Protection (CBP) and the National Customs Brokers and Forwarders 
Association of America (NCBFAA) to develop a voluntary partnership 
between CBP and the customs brokerage community.

Purpose

    The purpose of the partnership was to facilitate a higher level of 
broker compliance with CBP laws and regulations, specifically those in 
part 111 of title 19 of the Code of Federal Regulations (19 CFR part 
111), so that the agency could focus on higher-risk trade enforcement 
issues. All brokers who were current members of the Customs-Trade 
Partnership Against Terrorism (C-TPAT) were permitted to apply for the 
BSA pilot by signing a BSA Memorandum of Understanding (MOU) and 
completing a BSA questionnaire.
    A total of twenty-seven (27) brokers applied and four (4) were 
selected to participate in the pilot based on the criteria discussed 
above and CBP and NCBFAA's desire to have brokerages that represented 
small, medium, and large volumes of activities.

Pilot Design

    CBP and NCBFAA modeled the pilot after the existing Importer Self-
Assessment (ISA) program, which is based on the premise that importers 
with internal controls in place achieve the highest level of compliance 
with CBP laws and regulations. Similarly, the premise with the BSA 
pilot was that brokers with strong internal controls would achieve the 
highest level of compliance with customs laws and regulations.

[[Page 75554]]

    The pilot program was designed to allow customs brokers to 
voluntarily provide CBP with internal control procedures designed to 
ensure their compliance with broker requirements such as annual summary 
reports from periodic compliance evaluations and risk assessments. CBP 
provided the participants with recognition and support, in the form of 
consultations and general assistance.
    The BSA team, which was comprised of CBP regulatory auditors and 
national account managers, gathered and analyzed the data provided by 
the participants to determine whether: (1) The resources expended by 
brokers were commensurate with the potential gains to CBP and the 
broker; (2) there were mutual benefits for CBP and the broker that 
would make the program attractive; and (3) the intent of the pilot was 
realized through the pilot design utilized. In making its assessment, 
the BSA team examined the brokers' processing of its clients' 
submissions in the following areas: periodic monthly statement; bonded 
warehouse; importer security filings; remote location filing; and 
drawback.

Pilot Results

    CBP's assessment of the pilot results showed that the participants 
successfully demonstrated their supervision and control over customs 
transactions and documented their internal controls over their customs 
operations. However, the procedures for the internal controls, such as 
supervision and control over customs transactions and customs 
operations, were not always written, and in some cases, the procedures 
were modified or improved, but not yet implemented. The pilot also 
disclosed that the broker's assessment of risk factors differed from 
the risk factors CBP identified as potentially significant risks.
    All of the participants agreed that the BSA pilot helped them 
identify some areas of risk that they had not previously considered. 
Most of the participants concluded that the development of the internal 
control procedures revealed ways to better manage and mitigate risk 
factors.
    The reliable quantitative measure related to import transactions is 
the compliance measurement rate, which primarily measures compliance in 
areas such as, classification, valuation, free trade agreement, anti-
dumping and countervailing duty. It was discovered in the BSA Pilot 
that the compliance measurement rate did not necessarily correlate with 
demonstrated compliance on the part of the broker.
    The BSA evaluation team's assessment of the broker's internal 
control for achieving compliance with the CBP regulations (19 CFR part 
111) concluded that the participants demonstrated a strong commitment 
to ensuring compliance, professional ethics and professional 
development of their employees to meet its overall objective in regards 
to broker oversight and management controls. Moreover, the participants 
generally provided exemplary documentation to support their processes, 
which validated the assertions made as to the significant resources 
allocated in preparation for the team's assessment. The NCBFAA observed 
that the BSA pilot demonstrated that business profiles and process 
management within the brokerage community is highly diverse. As such, 
it would be difficult to provide for a standard template that CBP could 
use to establish uniform methodology for compliance verification. 
NCBFAA recommended that CBP not pursue the BSA pilot as it is currently 
designed.
    Since CBP has decided to end the BSA pilot without a plan to 
proceed with another Importer Self-Assessment type model, CBP and 
NCBFAA will pursue other avenues to collaborate pertaining to trade 
modernization efforts.
    The complete March 1, 2011 ``Broker Self-Assessment Outreach 
Pilot'' Report is available on the following Web site: http://www.cbp.gov/linkhandler/cgov/trade/trade_programs/bsa/bsa_report.ctt/bsa_report.pdf.

    Dated: November 29, 2011.
Allen Gina,
Assistant Commissioner, Office of International Trade.
[FR Doc. 2011-31009 Filed 12-1-11; 8:45 am]
BILLING CODE 9111-14-P