[Federal Register Volume 84, Number 172 (Thursday, September 5, 2019)]
[Rules and Regulations]
[Pages 46678-46681]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-19149]
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DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
DEPARTMENT OF THE TREASURY
19 CFR Part 24
[USCBP-2019-0032; CBP Dec. No. 19-10]
RIN 1515-AE47
Amendment to Statement Processing and Automated Clearinghouse
(ACH)
AGENCY: U.S. Customs and Border Protection, Department of Homeland
Security; Department of the Treasury.
ACTION: Interim final rule; solicitation of comments.
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SUMMARY: This document amends the U.S. Customs and Border Protection
(CBP) regulations regarding statement processing and Automated
Clearinghouse (ACH) to reflect that CBP will identify final statements
as paid upon the completion of the funds transfer. Additionally, this
document makes certain technical corrections to the CBP regulations on
statement processing and ACH.
DATES: This interim final rule is effective September 7, 2019; comments
must be received by November 4, 2019.
ADDRESSES: You may submit comments, identified by docket number USCBP-
2019-0032, by one of the following methods:
Federal eRulemaking Portal at http://www.regulations.gov.
Follow the instructions for submitting comments via Docket No. USCBP-
2019-0032.
Mail: Trade and Commercial Regulations Branch, Regulations
and Rulings, Office of Trade, U.S. Customs and Border Protection, 90 K
Street NE, 10th Floor, Washington, DC 20229-1177.
Instructions: All submissions received must include the agency name
and docket 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 be inspected during regular business days between the hours of 9
a.m. and 4:30 p.m. at the Trade and Commercial Regulations Branch,
Regulations and Rulings, Office of Trade, U.S. Customs and Border
Protection, 90 K Street NE, 10th Floor, Washington, DC. Arrangements to
inspect submitted comments should be made in advance by calling Mr.
Joseph Clark at 202-325-0118.
FOR FURTHER INFORMATION CONTACT: Kara Welty, Debt Management Branch,
Revenue Division, Office of Finance, (866) 530-4172,
[email protected].
SUPPLEMENTARY INFORMATION:
I. Public Participation
Interested persons are invited to participate in this rulemaking by
submitting written data, views, or arguments on all aspects of this
interim final rule. See ADDRESSES above for information on how to
submit comments. CBP also invites comments that relate to the economic,
environmental, or federalism effects that might result from this
regulatory change. Comments that will provide the most assistance to
CBP will reference a specific portion of the rule, explain the reason
for any recommended change, and include data, information or authority
that support such recommended change.
II. Background on Statement Processing
Upon importation, the importer becomes liable to CBP for the amount
of duties, taxes, and fees estimated to be payable on the merchandise.
See 19 U.S.C. 1505(a) and sections 141.1(a), (b) and 141.3 of title 19
of the Code of Federal Regulations (19 CFR 141.1(a), 141.1(b), and
141.3). One way in which estimated duties, taxes, and fees can be
deposited with CBP is by transmitting the estimated duties, taxes, and
fees to CBP pursuant to statement processing, as described in 19 CFR
24.25. See 19 CFR 141.101.
Statement processing is a voluntary automated program for
participants in the Automated Broker Interface (ABI), allowing the
grouping of entry/entry summaries and entry summaries, by either
importer or by filer, on a daily basis. See 19 CFR 24.1(a)(8) and
24.25(a). Any duties, taxes, and fees (as well as interest, if
applicable) that are related to the grouped entry/entry summaries and
entry summaries may be paid with a single payment, rather than by
individual checks for each entry. See 19 CFR 24.25(a) and 143.32(p).
The ABI filer must elect whether payment for a particular entry
summary will be by individual check or by statement processing upon the
transmission of entry/entry summary and entry summary data to CBP
through ABI. See 19 CFR 24.25(c)(1). The election of statement
processing for a particular entry summary also requires the ABI filer
to elect (1) whether the entry summary is to be grouped by the importer
or broker, and (2) a valid scheduled statement date, which shall be
within ten (10) days of entry, but not on a Saturday, Sunday, or
holiday. See 19 CFR 24.25(c)(1) and (e).
On the scheduled statement date, CBP provides the ABI filer with a
preliminary statement that is transmitted electronically to the filer
using a CBP-authorized Electronic Data Interchange (EDI) system. 19 CFR
24.25(c)(2) and 143.32(p). The preliminary statement contains all
entry/entry summaries and entry summaries scheduled for that statement
date and the amount of duties, taxes, and fees due for payment. See 19
CFR 24.1(a)(8), 24.25(c)(2), and 143.32(p). The ABI filer is required
to ensure that payment is made on each preliminary statement within ten
(10) working days of the entry of the related merchandise. See 19 CFR
24.25(c)(2), (c)(3), and (e).
The preferred method of payment for ABI users of statement
processing is by ACH, except where the importer has provided a separate
check payable to ``U.S. Customs and Border Protection'' for customs
charges (mixing of payment methods for a single statement is
prohibited). See 19 CFR 24.1(a)(8) and 24.25(a). There are two (2) ACH
payment processes--the ACH debit process and the ACH credit process,
each of which is explained below with respect to its current state and
how that will change under the amended regulations.
[[Page 46679]]
III. ACH Payment Processes
A. ACH Debit Process
The ACH debit process is an arrangement in which the filer
electronically provides payment authorization for the Department of the
Treasury (Treasury)-designated ACH processor bank to perform an
electronic debit to the payor's bank account. See 19 CFR 24.25(a). ABI
filers using this process are required to provide CBP with the bank
account and routing number for each account from which ACH payments are
to be electronically debited. See 19 CFR 24.25(b)(2). The ABI filer
initiates the payment process by transmitting one ACH debit
authorization per preliminary statement to CBP through ABI. See 19 CFR
24.25(a) and (c). If the ACH debit authorization is error-free, then
CBP will accept the ACH debit authorization and provide the ABI filer
with a message confirming CBP's acceptance of the ACH debit
authorization. See 19 CFR 24.25(c)(4).
Currently, upon CBP's acceptance of the ACH debit authorization,
CBP identifies the preliminary statement as paid and posts the
appropriate amounts to the related entries. CBP then initiates the
funds transfer by sending an electronic message to the Treasury-
designated ACH processor bank instructing the Treasury-designated ACH
processor bank to perform an electronic debit to the payor's bank
account. See 19 CFR 24.25(a) and (c)(4). CBP generally makes the final
statement available to the ABI filer the day following the acceptance
of the ACH payment. See 19 CFR 24.25(c)(4). A final statement serves as
evidence of the payment of a preliminary statement through an ACH
transaction. See 19 CFR 24.25(c)(4).
Even though the preliminary statement is currently identified as
paid upon acceptance of the ACH debit authorization, the funds transfer
is usually not completed until two (2) business days after CBP's
acceptance of the ACH debit authorization. To more accurately reflect
the status of the funds transfer, CBP is amending its regulations to
remove the requirement to identify the preliminary statement as paid.
The preliminary statement will still be issued; but, instead, the
amended regulations will require CBP to identify the final statement as
paid and post the appropriate amounts to the related entries upon
receiving confirmation from Treasury that the funds are available and
transferred to CBP (which marks the completion of the funds transfer).
The amendments to the CBP regulations do not affect the timeliness
of the payment, which remains based upon the date of CBP's acceptance
of the ACH debit authorization. Once CBP receives confirmation from
Treasury that the funds are available and transferred to CBP, then CBP
will treat the date of CBP's acceptance of the ACH debit authorization
as the effective payment date for purposes of determining the
timeliness of the payment. The date of CBP's acceptance of the ACH
debit authorization also remains the date for the calculation of
interest and/or liquidated damages, if applicable; the calculation is
unaffected by this amendment to the CBP regulations pertaining to ACH
debit payments.
B. ACH Credit Process
Pursuant to 19 CFR 24.26(a), ACH credit is an optional payment
method that allows a payor to electronically transmit statement
processing payments under 19 CFR 24.25, deferred tax payments under 19
CFR 24.4, or bill payments under 19 CFR 24.3, through its financial
institution, directly to the CBP account maintained by Treasury.
Currently, when an importer uses the ACH credit process, CBP will, upon
the acceptance of the credit payment, identify the preliminary
statement as paid and post the appropriate amounts to the related
entries. See 19 CFR 24.25(c)(4).
In order to promote consistency with the amendments to the ACH
debit process, CBP is also amending 19 CFR 24.25(c)(4) to reflect that
CBP will identify final statements, as opposed to preliminary
statements, as paid for the ACH credit process. As explained above for
the ACH debit process, these changes do not affect either the
timeliness of the payment or the date for the calculation of interest
and/or liquidated damages, if applicable, for the ACH credit process.
C. Implementation of Changes
In order to provide for the changes to the ACH payment processes
discussed above, and to provide clarity regarding which aspects of the
payment processes are not affected, this document amends Sec.
24.25(c)(4) by revising this provision and by splitting this provision
into three (3) subparagraphs--paragraphs (c)(4)(i) through (iii).
Paragraph (c)(4)(i) of Sec. 24.25 reflects that, for purposes of
determining the timeliness of the statement payment (as well as the
calculation of any interest and/or liquidated damages, if applicable),
CBP will continue to use the date of acceptance of the ACH debit
payment authorization or ACH credit payment as the payment date once
CBP receives confirmation from Treasury that the funds are available
and transferred to CBP.
Paragraph (c)(4)(ii) of Sec. 24.25 reflects the changes to CBP's
internal accounting procedures; particularly, that CBP will, upon
receiving confirmation from Treasury that the funds are available and
transferred to CBP, identify the final statement as paid and post the
appropriate amounts to the related entries.
Paragraph (c)(4)(iii) of Sec. 24.25 reflects that CBP will
continue to generally make available to the filer the final statement
on the day following the receipt of the ACH payment by CBP. This
paragraph also clarifies that CBP continues to accept final statements
(for ACH transactions) and cancelled checks as evidence that can be
used to prove that statement payment has occurred.
IV. Nomenclature Updates
This document also proposes to update the nomenclature in Sec.
24.25, due to the renaming of the U.S. Customs Service to U.S. Customs
and Border Protection. Specifically, this document is amending
paragraph (a) of Sec. 24.25, by replacing the reference to ``U.S.
Customs Service'' with ``U.S. Customs and Border Protection'', as well
as making a grammatical change to the phrase ``Customs charges'' to be
in the lower case. Second, due to the renaming of the U.S. Customs
Service to U.S. Customs and Border Protection, this document proposes
to replace references to ``Customs'' with ``CBP'' in Sec. 24.25.
V. Statutory and Regulatory Requirements
A. Inapplicability of Notice and Delayed Effective Date
The Administrative Procedure Act (APA) requirements in 5 U.S.C. 553
govern agency rulemaking procedures. Section 553(b) of the APA
generally requires notice and public comment before issuance of a final
rule. In addition, section 553(d) of the APA requires that a final rule
have a 30-day delayed effective date. The APA, however, provides
exceptions from the prior notice and public comment requirement and the
delayed effective date requirements, when an agency for good cause
finds that such procedures are impracticable, unnecessary, or contrary
to the public interest. CBP finds that prior notice and comment are
unnecessary and that good cause exists to issue this rule effective
upon publication.
[[Page 46680]]
Prior notice and comment are unnecessary because the rule does not
substantively alter the underlying rights or interests of importers or
filers. Instead, the rule is essentially technical by merely modifying
the regulations to reflect the marking of a statement as paid to
coincide with the completion of the funds transfer for the ACH debit
and credit payment processes. CBP will continue to treat the date of
CBP's acceptance of the ACH debit authorization and the ACH credit
payment as the effective payment date for purposes of determining the
timeliness of the statement payment (as well as for the calculation of
any interest and/or liquidated damages, if applicable) once CBP
receives confirmation from Treasury that the funds are available and
transferred to CBP. Accordingly, the trade community will experience no
delays, interruptions or process changes associated with this change to
the regulations. This change only affects CBP's internal accounting
procedures and does not alter the substantive rights of the members of
the trade community.
B. Executive Orders 13563, 12866 and 13771
Executive Orders 13563 and 12866 direct agencies to assess the
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, of reducing costs, of harmonizing rules, and of promoting
flexibility. Executive Order 13771 directs agencies to reduce
regulation and control regulatory costs and provides that ``for every
one new regulation issued, at least two prior regulations be identified
for elimination, and that the cost of planned regulations be prudently
managed and controlled through a budgeting process.''
This interim final rule is not a ``significant regulatory action,''
under section 3(f) of Executive Order 12866. Accordingly, the Office of
Management and Budget (OMB) has not reviewed this regulation. As this
rule is not a significant regulatory action, this rule is exempt from
the requirements of Executive Order 13771. See OMB's Memorandum titled
``Guidance Implementing Executive Order 13771, Titled `Reducing
Regulation and Controlling Regulatory Costs' '' (April 5, 2017).
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.), as amended
by the Small Business Regulatory Enforcement and Fairness Act of 1996,
requires an agency to prepare and make available to the public a
regulatory flexibility analysis that describes the effect of a proposed
rule on small entities (i.e., small businesses, small organizations,
and small governmental jurisdictions) when the agency is required to
publish a general notice of proposed rulemaking for a rule. Since a
general notice of proposed rulemaking is not necessary for this rule,
CBP is not required to prepare a regulatory flexibility analysis for
this rule.
D. Paperwork Reduction Act
This interim final rule does not impose an additional information
collection burden under the Paperwork Reduction Act of 1995 (44 U.S.C.
3507) and does not involve any material change to the existing approved
information collection by the Office of Management and Budget (OMB)
under assigned OMB control number 1651-0078.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless the collection of
information displays a valid control number assigned by OMB.
E. Signing Authority
This document is being issued by CBP in accordance with Sec.
0.1(a)(1) of the CBP Regulations (19 CFR 0.1(a)(1)) pertaining to the
authority of the Secretary of the Treasury (or his/her delegate) to
approve regulations related to certain customs revenue functions.
List of Subjects in 19 CFR Part 24
Accounting, Claims, Harbors, Reporting and recordkeeping
requirements, Taxes.
Amendments to the Regulations
For the reasons stated above, part 24 of title 19 of the Code of
Federal Regulations (19 CFR part 24) is amended as set forth below:
PART 24--CUSTOMS FINANCIAL AND ACCOUNTING PROCEDURE
0
1. The general authority citation for part 24 continues to read as
follows:
Authority: 5 U.S.C. 301; 19 U.S.C. 58a-58c, 66, 1202 (General
Note 3(i), Harmonized Tariff Schedule of the United States), 1505,
1520, 1624; 26 U.S.C. 4461, 4462; 31 U.S.C. 3717, 9701; Pub. L. 107-
296, 116 Stat. 2135 (6 U.S.C. 1 et seq.).
* * * * *
0
2. In Sec. 24.25:
0
a. Paragraph (a), third sentence, is amended by:
0
1. Removing the phrase `` ``U.S. Customs Service'' '' and adding the
phrase `` ``U.S. Customs and Border Protection'' '' in its place;
0
2. Removing the phrase ``Customs charges'' and adding the phrase
``customs charges'' in its place; and
0
3. Removing the word ``Customs'' before the phrase ``(see Sec.
111.29(b) of this chapter)'' and adding the word ``CBP'' in its place.
0
b. Paragraph (a), seventh sentence is amended by removing the word
``Customs'' and adding the word ``CBP'' in its place;
0
c. Paragraph (b) is amended by removing the word ``Customs'' in each
place that it appears and adding in each place the word ``CBP'';
0
d. Paragraph (c)(2) is amended by removing the word ``Customs'' in each
place that it appears and adding in each place the word ``CBP'';
0
e. Paragraph (c)(4) is revised;
0
f. Paragraph (d) is amended by removing the word ``Customs'' in each
place that it appears and adding in each place the word ``CBP''; and
0
g. Paragraph (e) is amended in the last sentence by removing the word
``Customs'' and adding in its place the word ``CBP''.
The revision reads as follows:
Sec. 24.25 Statement processing and Automated Clearinghouse.
* * * * *
(c) * * *
(4) Payments made through ACH are processed as follows:
(i) Payment date; interest and liquidated damages. The date of
acceptance of the ACH debit payment authorization or ACH credit payment
for the preliminary statement is the payment date when determining
compliance with the due date for scheduled statements and for purposes
of Sec. 24.3a of this part, and subject to the provisions of Sec.
113.62(a)(1)(i) and (m)(4) of this chapter.
(ii) Issuance of final statement. CBP shall, upon confirmation from
the Department of the Treasury that funds are available and transferred
to CBP, identify the final statement as paid and post the appropriate
amounts to the related entries.
(iii) Evidence of payment. The final statement generally shall be
available to the filer the day following the receipt of the ACH payment
by CBP. The final statement may be utilized as evidence that statement
payment has occurred through an ACH transaction. In other
[[Page 46681]]
instances, a cancelled check may serve as evidence of payment.
* * * * *
Robert E. Perez,
Deputy Commissioner, U.S. Customs and Border Protection.
Approved: August 29, 2019.
Timothy E. Skud,
Deputy Assistant Secretary, Department of the Treasury.
[FR Doc. 2019-19149 Filed 9-4-19; 8:45 am]
BILLING CODE 9111-14-P