[Federal Register Volume 91, Number 164 (Wednesday, August 26, 2026)]
[Rules and Regulations]
[Pages 55170-55227]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2026-17390]
[[Page 55169]]
Vol. 91
Wednesday,
No. 164
August 26, 2026
Part II
Department of Homeland Security
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U.S. Customs and Border Protection
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19 CFR Parts 103, 113, 123, et al.
Automated Commercial Environment (ACE) Electronic Export Manifest for
Rail Cargo; Final Rule
Federal Register / Vol. 91, No. 164 / Wednesday, August 26, 2026 /
Rules and Regulations
[[Page 55170]]
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DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
19 CFR Parts 103, 113, 123, and 192
[Docket No. USCBP-2024-0030; CBP Dec. 26-15]
RIN 1651-AB52
Automated Commercial Environment (ACE) Electronic Export Manifest
for Rail Cargo
AGENCY: U.S. Customs and Border Protection, DHS.
ACTION: Final rule.
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SUMMARY: U.S. Customs and Border Protection (CBP) is revising its
regulations pursuant to the Trade Act of 2002 requiring the
transmission of export manifest data electronically in the Automated
Commercial Environment (ACE) for cargo transported by rail for any
train departing the United States. This rule mandates the electronic
transmission of rail export manifest information, identifies the
parties eligible to transmit information, and describes the time frames
prior to departure in which the information is due. This rule enables
CBP to address important cargo security concerns while providing
efficiencies to the trade.
DATES: Effective date: This rule is effective on October 26, 2026.
Compliance date: CBP will begin enforcing this rule on October 26,
2027.
FOR FURTHER INFORMATION CONTACT: David Garcia, Program Manager,
Outbound Enforcement and Policy Branch, Office of Field Operations,
CBP, via email at [email protected].
SUPPLEMENTARY INFORMATION:
I. Executive Summary
A. Purpose of Revising the Regulations for Electronic Export Manifest
for Rail Cargo
Current regulations are insufficient to adequately capture cargo
data for rail shipments leaving the United States. U.S. Customs and
Border Protection (CBP) is finalizing this rule to reduce the data gaps
existing under current regulations, and to address important cargo
security concerns resulting from incomplete data. This rule will apply
to all rail cargo exports and provide efficiencies to the trade. CBP
does not presently require the pre-departure electronic transmission of
data for all exported cargo as it does for imported cargo. This can
result in a threat to cargo and broader U.S. national security because
CBP has no regulations prescribing any method or means of review for
cargo being exported by rail. The electronically transmitted cargo data
that is transmitted prior to departing the United States by rail is
limited significantly in its scope. Currently, 19 CFR 192.14 requires a
U.S. Principal Party in Interest (USPPI), the USPPI's agent, or the
authorized filing agent of a Foreign Principal Party in Interest (FPPI)
to transmit Electronic Export Information (EEI) to CBP through the
Automated Commercial Environment (ACE). While this pre-departure data
is helpful, EEI is generally only required by the Bureau of Census
regulations on shipments that exceed $2,500, per Schedule B number and
is generally not required for shipments to Canada unless certain
controlled items are involved or the shipment is being transshipped to
another destination. 15 CFR Parts 30 and 758. Because of these
limitations, there is a significant lack of electronic manifest data
which inhibits the enforcement efforts by CBP for such exports. This
rule creates an integrated pre-departure electronic export manifest
which includes receiving advance information for risk assessment
purposes from the source most likely to have correct information about
the cargo. This rule closes the gap which currently exists and requires
all information to be manifested which enhances the security of the
rail cargo and aligns the security of exported rail cargo with the
regulations that are required of rail cargo imported into the United
States.
B. Statutory Authority
Pursuant to Section 343(a) of the Trade Act of 2002, as amended
(``Trade Act'') (19 U.S.C. 1415), CBP is authorized to promulgate
regulations providing for the mandatory transmission of electronic
cargo information by way of a CBP-authorized electronic data
interchange (EDI) system before cargo arrives or departs the United
States by any mode of commercial transportation (sea, air, rail, or
truck). The required cargo information is reasonably necessary to
ensure cargo safety and security pursuant to the laws enforced and
administered by CBP. 19 U.S.C. 1415(a)(2)). CBP needs to obtain timely
and sufficient data prior to cargo arriving or departing the United
States via any mode of commercial transportation to review and conduct
risk assessments to identify high-risk shipments and inspect cargo
effectively.
C. Summary of the Rule
This rule mandates the transmission of electronic export manifest
(EEM) data, in addition to the EEI data required under 15 CFR part 30,
for all cargo prior to departing the United States for Canada and
Mexico in the rail environment in lieu of paper submissions. The new
regulation, to be codified at 19 CFR 123.93, mandates the electronic
transmission of rail export manifest information, identifies the
parties eligible to transmit such information, describes the time
frames prior to departure of the train in which the information is due,
requires a bond to secure compliance with the new regulation, and
identifies an initial filing that must occur as early as practicable,
but no later than 24 hours prior to departure from the U.S. port of
export while requiring the remaining data to be transmitted at least
two hours prior to such departure. The new regulation designates
information as transportation data, cargo data, or empty container
data, and lists the data elements to be transmitted while identifying
and classifying them as mandatory, conditional, or optional. The data
elements identified as mandatory must be transmitted, while elements
identified as conditional shall be transmitted if applicable, and
optional elements may be transmitted at the discretion of the party
making the transmission. These data elements will allow CBP to inspect
cargo effectively, ensure compliance with U.S. export control laws and
regulations, and identify high-risk shipments for purposes of ensuring
cargo safety and security.
In the notice of proposed rulemaking (NPRM), 90 FR 2874, 2917 (Jan.
13, 2025), CBP proposed that the initial filing ``must be transmitted
as early as practicable, but no later than 24 hours prior to departure
of the train from the United States.'' Subsequent filings were due ``no
later than two hours prior to departure of the train from the United
States.'' Id. In this final rule, consistent with the NPRM preamble and
to provide greater clarity regarding these deadlines, CBP has revised
the regulatory text such that the 24-hour and 2-hour deadlines are
keyed to the ``departure of the train from the United States port of
export,'' rather than simply ``departure of the train from the United
States.'' \1\ This change is intended to make explicit that
[[Page 55171]]
the operative deadline is the train's scheduled departure from the
designated U.S. port of export and to avoid any ambiguity regarding
inland rail yards or other locations.
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\1\ See, e.g., 90 FR at 2880 (``The proposed regulation would .
. . identify an initial filing that must occur 24 hours prior to
departure from the port of export while requiring the remaining data
to be transmitted at least two hours prior to such departure.''
(emphases added)).
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Also in the NPRM, CBP proposed to add 19 CFR 123.93(c), which
identifies the parties that can transmit the cargo and conveyance data.
The outbound carrier is responsible for transmitting the export
manifest transportation data and empty container data. If no other
party elects to transmit the initial filing data and the export
manifest cargo data, then the outbound carrier must transmit this data.
If another eligible party elects to transmit either the initial filing
data or export manifest cargo data, the outbound carrier may also
choose to, but is not required to, transmit such data. Other eligible
parties include the USPPI and FPPI, or an authorized agent, as those
parties are defined in section 30.1 of the Federal Trade Regulations
(FTR) of the Department of Commerce, Bureau of the Census (15 CFR
30.1). Other eligible transmitters also include any other party with
direct knowledge of the export information, such as a customs broker,
Automated Broker Interface (ABI) filer, Non-Vessel Operating Common
Carrier (NVOCC) as defined by 19 CFR 4.7(b)(3)(ii), or a freight
forwarder as defined in 19 CFR 112.1. If another party does not
transmit advance export information, then the party that arranges for
and/or delivers the cargo to the outbound carrier must fully disclose
and present to the outbound carrier the data elements for the initial
filing. Based on the comments received after the publication of the
NPRM regarding certain parties such as freight forwarders or NVOCCs,
CBP is amending 19 CFR 123.93(c) to reflect that these parties will not
be acting as customs brokers but, in this instance, acting as EEM
transmitters. Specifically, in section 123.93(a), CBP is adding a
provision stating that ``[t]he transmission of such EEM data for the
purpose of complying with this section does not constitute customs
business.''
Section 123.93(d) requires a mandatory initial filing of seven data
elements identified below to be transmitted as early as practicable,
but no later than 24 hours prior to departure from the United States,
by either the carrier, USPPI, or another qualified party or their
authorized agent. The results of the Test have shown that some rail
carriers would have the export manifest data available days in advance
prior to departure and therefore would have all the necessary
information to transmit the initial filing data to CBP and all other
export manifest data well in advance of the 24-hour prior to departure
deadlines.\2\ Except for the initial data elements, CBP would require
electronic export manifest information in sections 123.93(e), and (f)
to be transmitted two hours prior to train departure from the U.S. port
of export.
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\2\ The results of the rail EEM test are discussed in further
detail under Section VII below.
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Based upon comments submitted, CBP is making the following changes
in paragraphs (d), (e), and (f) as compared to the NPRM:
In paragraphs (d)(1)(v) and (vi) (which were paragraphs
123.93(d)(5) and (6) in the NPRM), CBP is removing the identification
number from these data elements to remove any potential uncertainty and
to provide CBP with the necessary information that is sought.
In paragraph (d)(2), CBP is revising its approach to
exemption statements. This revision introduces a conditional element to
be transmitted with the initial filing at the time of the initial
filing, or as soon as the information becomes applicable: the Automated
Export System (AES) Internal Transaction Number (ITN) or FTR exemption/
exclusion code. (As proposed, there was a mandatory data element for
``Automated Export System (AES) Exemption Statement, as applicable.'')
Making this data element conditional will allow the filer to complete
the initial EEM filing even when the ITN or FTR exemption/exclusion
code is not yet available.
In paragraph (d)(1)(vii), and in paragraphs (e), and (f),
CBP now includes a new data element, ``Employer Identification Number
(EIN) or Importer Record Number (IRN) or CBP assigned number,'' that
will help CBP identify the transmitter's required bond, which will be
obligated to secure the filing, and will be a mandatory data element
for the initial filing, transportation data filing, and cargo data
filing. CBP will determine the obligated bond as follows: if the
transmitter has an active international carrier bond, the transmitter's
international carrier bond will be obligated to secure the filing; if
the transmitter does not have an active international carrier bond but
does have an active basic custodial bond, the transmitter's basic
custodial bond will be obligated to secure the filing; and if the
transmitter has neither an active international carrier bond nor an
active basic custodial bond but does have an active basic importation
and entry bond, the transmitter's basic importation and entry bond will
be obligated to secure the filing.
Section 123.93(g) provides for two types of referrals that may be
issued by CBP after a risk assessment of an outbound export manifest
data transmission. Should any rail cargo be identified by CBP as
requiring review, the cargo will not depart until the required
additional information related to the shipment is transmitted or some
other appropriate action is taken, as specified by CBP. Once the cargo
is cleared for loading, a release message will be generated and
transmitted to the filer. Section 123.93(h) provides for additional
procedures for when a CBP officer determines during the review that
cargo or a rail car may contain a potential threat to the train and its
vicinity, so that a Do-Not-Load (DNL) instruction can be issued. A DNL
instruction prohibits the rail carrier from transporting that cargo or
rail car so that further examination can be conducted. These
examinations allow CBP to secure the cargo, conduct risk assessments,
and inspect cargo effectively. CBP is changing paragraph (h), as
compared to the NPRM, by:
Making clear that DNL and Hold instructions are issued
``to the outbound rail carrier and any other transmitter as soon as
applicable''; and
Providing that ``[a]ll outbound rail carriers and
transmitters who receive a DNL or Hold instruction must contact CBP at
the port of export.''
As an enforcement tool, CBP is also changing the relevant bond
provisions in 19 CFR 113.62 (basic importation and entry bond), 19 CFR
113.63 (basic custodial bond), and 19 CFR 113.64 (international carrier
bond) to provide CBP with authority to assess liquidated damages when
parties do not provide the mandatory EEM data in the manner and in the
time frame required. Specifically, CBP is amending 19 CFR 113.62 to add
new paragraph (k)(3), and amending 19 CFR 113.63(g) and 19 CFR
113.64(d), to add new parameters for failure to electronically provide
outbound information in the manner and time frame required because
these provisions currently address electronic transmissions for
merchandise or cargo which is inbound. With each of these regulations,
CBP may assess liquidated damages if a violation occurs. CBP's primary
goal is compliance and CBP seeks to work alongside rail carriers and
other parties to ensure that the proper data is provided in a timely
manner, for CBP to properly review the data, conduct risk assessment of
high-risk shipments, and enforce U.S. export laws and regulations on
U.S. rail exports. As compared to the NPRM, CBP is also changing
proposed 19 CFR 113.64(d)(1) by removing the references to ``Sec. Sec.
4.7 and 4.7(a) of this chapter'' and changing the language to read
``applicable regulations'' so that CBP can rely on this
[[Page 55172]]
regulation to enforce violations in other modes of transportation
without further amendment. Similarly, in sections 113.62(k)(3),
113.63(g)(2), and 113.64(d)(1) and (2), CBP is removing the references
to ``under Sec. 123.93 of this chapter'' and changing the language to
read ``by regulation'' so that CBP can rely on those regulations to
enforce violations in other modes of transportation without further
amendment. This final rule will also require a party transmitting the
EEM data to CBP to have an appropriate bond on file with CBP that
contains the condition to transmit advance export information in the
manner required by regulation. This rule goes into effect 60 days after
publication, but CBP will not begin enforcing this rule until one year
after publication, which gives a party expecting to need an appropriate
bond when CBP begins enforcing this rule 300 days to obtain such a
bond, either by terminating and replacing an existing continuous bond
or by obtaining a new bond (continuous or single transaction). At one
year, a bond that does not contain the condition to transmit advance
export information in the manner required by regulation will be deemed
insufficient.
For CBP, this requirement to transmit an electronic export manifest
will enhance cargo security because it provides improvements in risk
assessment capabilities by allowing CBP to use its Automated Targeting
System (ATS) to screen all of the data transmitted. Port operations
will enjoy considerable efficiencies through the elimination of paper
manifests. Storage space currently reserved for manifest documents will
be freed. Coordination and information exchange among CBP, the
Department of Commerce, and other partner government agencies with
export jurisdiction will improve. Carriers, USPPIs, NVOCCs, and other
interested parties who transmit information will receive more thorough
and rapid examination decisions from CBP and improved communication
between CBP and trade members. The trade will benefit through the ease
of making information corrections and additions electronically in
contrast to the more time-consuming process that is required with paper
submissions. These benefits, including improved targeting capabilities,
which are necessary for security purposes, outweigh the flexibility of
allowing parties to file submissions either by paper or electronically.
CBP has also made a couple of other conforming changes as compared
to the NPRM. First, CBP is amending Sec. 192.14(b)(1)(iv) to clarify
that, for rail cargo, Electronic Export Information (EEI) included in
an initial data transmission of electronic export manifest (EEM)
information must be filed in accordance with the provisions of Sec.
123.93. This change aligns the EEI filing requirements for rail exports
with the new electronic export manifest procedures. The purpose of the
change is to avoid any potential conflict or confusion regarding the
applicable filing deadlines.
Second, as compared to the NPRM, CBP is making a clarifying change
to Sec. 103.31a(a) to add a reference to Sec. 123.93. Specifically,
CBP is listing advance electronic information for outbound rail cargo
submitted under the new electronic export manifest requirements as
information that is covered by the availability of information
provisions in Sec. 103.31a.
D. Costs and Benefits
CBP anticipates that during the time period of analysis, including
the Test period and the regulatory period (2016-2030), this final rule
will result in costs, cost savings, and benefits to CBP and trade
members engaging in exporting merchandise out of the United States in
the rail environment.\3\ CBP estimates present value total costs to CBP
and trade members will range from $10.3 million (discounted 2025 U.S.
dollars) using a three percent discount rate to around $7.0 million
(discounted 2025 U.S. dollars) using a seven percent discount rate. The
annualized total costs are estimated to range from $859,845 using a
three percent discount rate to around $764,026 using a seven percent
discount rate. CBP identified some other potential costs from this rule
and some comments from the public voiced concerns about these costs but
did not provide monetized values for costs to trade members. Therefore,
CBP was unable to monetize these costs, including time burdens to CBP
officers if the final rule results in additional cargo examinations and
costs to trade members participating in the rail EEM from adjusting
business practices, requiring participants to hold or obtain an
appropriate bond, requiring outbound rail carriers to have staff
available to respond to CBP questions, and trade members potentially
being liable for liquidated damages for any violations. Present value
total cost savings to CBP and trade members are expected to range
between around $47.7 million (discounted 2025 U.S. dollars) using a
three percent discount rate, and $29.6 million (discounted 2025 U.S.
dollars) using a seven percent discount rate. Annualized cost savings
are estimated to range from $4.0 million using a three percent discount
rate and $3.3 million using a seven percent discount rate. CBP expects
that there will be additional cost savings to trade members that CBP
was unable to monetize such as reduced paper, printing and storage
costs related to paper forms, and reducing or eliminating instances
where trains need to be deconstructed in order for CBP to examine cargo
that typically results in a delay of up to two hours and around $3,000
in freight movement costs. CBP anticipates that benefits from this
final rule will include improving CBP's security efforts by using ATS
to conduct risk assessments on all rail exports, improving
communication between federal agencies with export jurisdiction, and
improving efficiencies to participating trade members from
transitioning from a paper to an electronic process. However, CBP was
unable to monetize the expected benefits from this final rule. Present
value total net cost savings from the implementation of this final rule
will range from $37.5 million (discounted 2025 U.S. dollars) using a
three percent discount rate and $22.7 million (discounted 2025 U.S.
dollars) using a seven percent discount rate. Annualized net cost
savings from this final rule are expected to range from $3.1 million
using a three percent discount rate to $2.5 million using a seven
percent discount rate.\4\ Table 1 below displays CBP's estimates for
annualized costs, cost savings, benefits, and net costs from this final
rule using a three and seven percent discount rate over the period of
analysis (2016-2030). Additionally, based on CBP's perpetual time
horizon calculations, the present value of net cost savings from this
final rule will be $128.6 million and the annualized value of net cost
savings will be $9.01 million using a seven percent discount.
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\3\ In the Regulatory Impact Analysis for this final rule, CBP
also discusses and provides estimates for the costs, cost savings,
and benefits compared to the baseline (prior to the introduction of
the rail EEM test) during both the rail EEM test pilot period (2016-
2025) and for the regulatory period (2026-2030).
\4\ In the economic analysis for this final rule, CBP used a
three and seven percent discount rate for estimated future
quantified and monetized costs, cost savings, and benefits based on
guidance from OMB Circular A-4.
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II. Statutory Authority
Section 343(a) of the Trade Act (19 U.S.C. 1415) authorizes CBP to
promulgate regulations providing for the mandatory transmission of
electronic cargo information by way of a CBP-authorized EDI system
before the cargo is brought into or departs the United States by any
mode of commercial transportation (sea, air, rail, or truck). The
required cargo information is reasonably necessary to enable CBP to
ensure cargo safety and security pursuant to the laws enforced and
administered by CBP. 19 U.S.C. 1415(a)(2).
CBP consulted with carriers throughout the process of developing
the proposed regulation and during the course of the ACE Export
Manifest for Rail Cargo Test that has been administered since 2015. 19
U.S.C. 1415(a)(3)(A). As the statute requires, in general, the
regulation imposes requirements on the party most likely to have direct
knowledge of information to be provided. When requiring information
from the party with direct knowledge of that information is not
practicable, the regulations take into account how, under ordinary
commercial practices, information is acquired by the party on which the
requirement is imposed, and whether and how such party is able to
verify the information. Where information is not reasonably verifiable
by the party on which a requirement is imposed, the regulations permit
that party to transmit information on the basis of what it reasonably
believes to be true. 19 U.S.C. 1415(a)(3)(B). The regulation that CBP
is promulgating will require the transmission of the export manifest
data electronically in ACE for cargo transported by rail, pursuant to
section 343(a), of the Trade Act. 19 U.S.C. 1415(a)(3)(E). Under
section 343(a)(3)(G) of the Trade Act (19 U.S.C. 1415(a)(3)(G)), CBP is
required to promulgate regulations that protect the privacy of business
proprietary and any other confidential cargo information provided to
CBP. Data electronically presented to CBP in accordance with 19 CFR
123.93 is specifically exempt from disclosure as either trade secrets
or privileged or confidential commercial or financial information under
19 CFR 103.31a, unless CBP receives a specific request for such records
pursuant to 6 CFR 5.3, and the owner of the information expressly
agrees in writing to its release. The regulations avoid imposing
requirements that are redundant with one another or that are redundant
with requirements in other provisions of law, as seen below. 19 U.S.C.
1415(a)(3)(I).
III. Background
A. Current Regulations
Under the existing regulations, commercial rail carriers are not
required to submit a paper or electronic manifest for cargo exported
from the United States by rail. CBP does have regulations which support
the transmission of EEI required by the Bureau of the Census Foreign
Trade Regulations (FTR) or the Bureau of Industry and Security's Export
Administration Regulations (EAR). Section 192.14 of title 19 of the
Code of Federal Regulations implements the requirements of the Trade
Act regarding cargo departing the United States. Under 19 CFR 192.14,
the USPPI, or its authorized agent, or the authorized filing agent of
the FPPI is required to transmit certain advance information to CBP for
export cargo leaving the United States by rail.\5\
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\5\ The USPPI is defined in the Bureau of the Census FTR as the
person or legal entity in the United States that receives the
primary benefit, monetary or otherwise, from the export transaction.
Generally, that person or entity is the U.S. seller, manufacturer,
or order party, or the foreign entity while in the United States
when purchasing or obtaining the goods for export. 15 CFR 30.1.
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Under 19 CFR 192.14, the USPPI or its authorized agent must
transmit and verify system acceptance of this EEI, generally no later
than two hours prior to the arrival of the train at the border. See 19
CFR 192.14(b)(1)(iv). A commercial rail carrier may not load cargo
without first receiving from the USPPI or its authorized agent either
the related EEI filing citation, covering all cargo for which the EEI
is required, or exemption legends, covering cargo for which EEI need
not be filed. See 19 CFR 192.14(c)(4)(i). While the rail carrier is not
required to transmit a rail cargo export manifest to CBP, the outbound
rail carrier must annotate the carrier's outward manifest, waybill, or
other export documentation with the applicable AES proof of filing,
post departure, downtime, exclusion, or exemption citations, conforming
to the approved data formats found in the Bureau of the Census FTR. See
15 CFR part 30.
The current regulations found in 19 CFR 192.14 also require the
USPPI, the USPPI's authorized agent, or the authorized filing agent of
the FPPI to electronically transmit to CBP through AES certain EEI.
This information supports statistical gathering; however, it falls
short of addressing important cargo security considerations because
almost all shipments with a value less than $2,500.00 per Schedule B
number and shipments directed to Canada are exempt from EEI filing
requirements, other than, for example, those containing certain items
controlled under the EAR or intended for transshipment through Canada,
creating a gap in security which this new regulation will resolve by
requiring information on all exports for rail cargo. CBP will require
the transmission of manifest information, providing CBP the opportunity
to more effectively target all shipments that are exported by rail,
which will increase CBP's ability to discover and interdict contraband
such as narcotics, weapons, or ammunition, thereby enhancing the
security of the United States. This new regulation will close the
security gap by requiring compliance with the regulation in order to
export the cargo as parties will have to provide pre-departure
electronic manifest information which CBP can screen and inspect for
the safety and security of the United States and its neighboring
countries. This new regulation also aligns with the current regulation
for rail cargo imported into the United States. See 19 CFR 123.91.
The transmission of EEI is a Bureau of the Census filing regulated
by 15 CFR part 30 and, with few exceptions, is only submitted when the
value of merchandise is above $2,500.00 per Schedule B commodity
classification number. See, e.g., 15 CFR 30.1(c) (definition of
``shipment''), 30.37(a).
The requirement to transmit EEI also does not apply to rail
shipments bound for Canada, unless such shipments contain certain
export-controlled items or are destined for transshipment to third
countries. See 15 CFR 30.36. This regulatory gap leaves many shipments
outside of CBP security review. The lack of pre-departure information,
which includes commodity information submitted by rail carriers into
CBP targeting systems, hinders CBP's ability to conduct risk
assessments and inspect cargo effectively to ensure cargo safety and
security. This new regulation creates an integrated pre-departure
electronic export manifest which includes receiving advance information
for risk assessment purposes from the source most likely to have
correct information about the cargo.
Currently, for exporting purposes, each carrier submits a train
consist in a format that the carrier develops and with the data
elements that the carrier believes should be reported. The train
consist identifies what is on the train, the order of the train, and
what the train is consisted of as it prepares to depart the country.
These data elements provide export information similar to that required
by the provisions of 19
[[Page 55175]]
CFR 123.91, which describes electronic information for rail cargo
required in advance of arrival, and 19 CFR 123.6, which includes a
train sheet for arriving railroad trains.
B. The ACE Export Manifest for Rail Cargo Test
On September 9, 2015, CBP published a general notice in the Federal
Register (80 FR 54305) announcing the National Customs Automation
Program (NCAP) Test for the transmission through ACE of EEM information
for rail shipments, the ACE Export Manifest for Rail Cargo Test
(``Test''), which was limited to nine rail carriers.
In part, the Test was used in furtherance of International Trade
Data System (ITDS) key initiatives, set forth in section 405 of the
Security and Accountability for Every Port Act of 2006, Public Law 109-
347, 120 Stat. 1884, 1929-1931 (SAFE Port Act), codified at 19 U.S.C.
1411(d), and Executive Order 13659, Streamlining the Export/Import
Process for America's Businesses, 79 FR 10655 (Feb. 25, 2014). The
purpose of ITDS, as stated in section 411(d)(1)(B) of the SAFE Port
Act, is to eliminate redundant information requirements, efficiently
regulate the flow of commerce, and effectively enforce laws and
regulations relating to international trade, by establishing a single
portal system operated by CBP for the collection and distribution of
standard electronic import and export data required by all
participating federal agencies. ACE was developed by CBP as the
``single window'' for the trade community to comply with the ITDS
requirement established by the SAFE Port Act. See 19 U.S.C.
1411(d)(1)(B).
The data elements in the original Test have been mandatory unless
otherwise indicated below. The Test has required that the five
conditional data elements be transmitted to CBP only if the particular
information pertains to the shipment or cargo. The data elements are
required to be transmitted at the lowest bill level. The data elements
in the Test for all shipments, including empty rail cars, consist of:
(1) Mode of Transportation (containerized rail cargo or non-
containerized rail cargo)
(2) Port of Departure from the United States
(3) Date of Departure
(4) Manifest Number
(5) Train Number
(6) Rail Car Order
(7) Car Locator Message
(8) Hazmat Indicator (Yes/No)
(9) 6-character Hazmat Code (conditional) (If the hazmat indicator is
yes, then UN (for United Nations Number) or NA (North American Number)
and the corresponding 4-digit identification number assigned to the
hazardous material must be provided.)
(10) Marks and Numbers
(11) SCAC (Standard Carrier Alpha Code) for exporting carrier
(12) Shipper name and address (For empty rail cars, the shipper may be
the railroad from whom the rail carrier received the empty rail car to
transport.)
(13) Consignee name and address (For empty rail cars, the consignee may
be the railroad to whom the rail carrier is transporting the empty rail
car.)
(14) Place where the rail carrier takes possession of the cargo
shipment or empty rail car
(15) Port of Unlading
(16) Country of Ultimate Destination
(17) Equipment Type Code
(18) Container Number(s) (for containerized shipments) or Rail Car
Number(s) (for all other shipments)
(19) Empty Indicator (Yes/No)
If the empty indicator is no, then the following data elements must
also be provided, as applicable:
(20) Bill of Lading Numbers (Master and House)
(21) Bill of Lading Type (Master, House, Simple, or Sub)
(22) Number of House Bills of Lading
(23) Notify Party name and address (conditional)
(24) AES Internal Transaction Number or AES Exemption Statement (per
shipment)
(25) Cargo Description
(26) Weight of Cargo (may be expressed in either pounds or kilograms)
(27) Quantity of Cargo and Unit of Measure
(28) Seal Number
(29) Split Shipment Indicator (Yes/No)
(30) Portion of split shipment (e.g., 1 of 10, 4 of 10, 5 of 10--Final,
etc.) (conditional)
(31) In-bond Number (conditional)
(32) Mexican Pedimento Number (only for shipments for export to Mexico)
(conditional)
On August 14, 2017, CBP extended the Test and began accepting
additional applications for all parties that met the eligibility
requirements of the original nine stakeholders composed of rail
carriers. (82 FR 37893). CBP consulted with the Commercial Customs
Operations Advisory Committee (COAC) to address issues concerning the
quality, accessibility, and timeliness of export manifest data received
during the Test.
After evaluating the initial phase of the Test and considering
COAC's comments, CBP determined that, to better test the functionality
and feasibility of transmitting the specified export data two hours
prior to loading of the cargo on the train, the filing condition for
nine of the data elements should be changed. The modified filing
conditions enabled CBP to better determine the appropriate reporting
requirements for each data element.
CBP modified the Test to change the following eight mandatory or
conditional data elements to optional:
Mode of Transportation (containerized rail cargo or non-
containerized rail cargo) (Data Element #1)
Place where the carrier took possession (Data Element #14)
Country of Ultimate Destination (Data Element #16)
Equipment Type Code (Data Element #17)
Number of House Bills of Lading (Data Element #22)
Split Shipment Indicator (Data Element #29)
Portion of Split Shipment (Data Element #30)
Mexican Pedimento Number (Data Element #32)
CBP also modified the Test to change Data Element #10, Marks and
Numbers, from mandatory to conditional.
The remaining data elements under the extended Test continued to be
mandatory, conditional, or optional as provided in the September 9,
2015 notice.
CBP identified in the expansion and modification of the Test that
it would reevaluate the filing conditions for each data element to
determine the feasibility of requiring that data element to be filed
electronically in ACE within a specified timeframe before the cargo is
loaded on the train, should CBP decide to conduct rulemaking.
Accordingly, this regulation changes the timing of presentation of most
electronic export manifest data from two hours prior to loading on the
train to two hours prior to departure of the train from the U.S. port
of export.
Since its inception, the Test evaluated the practicality of
requiring rail carriers to transmit export manifest data in a
standardized format by utilizing ACE ITDS initiatives. A key challenge
was that CBP had not yet established regulations for the specific data
elements needed, and carriers were providing train manifests in their
own chosen formats. ACE resulted in the creation of a single automated
export processing platform for certain export manifest, commodity,
licensing, export control, and export targeting transactions.
Transmitting export
[[Page 55176]]
manifest data through ACE reduces costs for CBP, partner government
agencies, and the trade community, and improves facilitation of export
shipments through the supply chain.
Additionally, the Test examined the feasibility of requiring the
rail carrier to transmit manifest information electronically in ACE,
generally within a specified timeframe before the cargo has been loaded
on the train. Test participants were required to transmit export
manifest data electronically to ACE at least two hours prior to loading
of the cargo or, for empty rail cars, upon assembly of the train. This
time frame enabled CBP to link the EEI transmitted by the USPPI with
the export manifest information. Much of that success resulted from the
fact that a high percentage of information is transmitted well before
the deadline of two hours prior to departure. CBP found that nearly 94
percent of data transmissions occurred more than 24 hours prior to
conveyance departure.\6\
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\6\ Information provided by CBP's Cargo and Conveyance Security,
Office of Field Operations, subject matter expert on May 9, and June
21, 2022. CBP conducted a random sample of train conveyances
participating in the rail EEM test and found that around 94 percent
of data transmissions were submitted 24 hours prior to departure.
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The success of the Test allowed CBP to determine that the
electronic transmission of manifests provides improvements in
capabilities at the departure level. As a result of these improvements,
CBP is now codifying this program with the regulations in this
document. Upon the effective date of this rule, the ACE Export Manifest
for Rail Cargo Test will end.
IV. Purpose and Need of the Rule
On January 13, 2025, CBP published a notice of proposed rulemaking
which proposed a new regulatory requirement because there are no
regulations in place requiring the submission of an electronic export
manifest for cargo transported by rail to assess cargo security. 90 FR
2874. The regulatory changes are the culmination of CBP's efforts with
the Test described above in Section III.
This regulation leverages the data elements and train consist
requirements in advance of departure to Mexico and Canada in order for
CBP to make the best use of the data. The data elements are already
included in the current Test, which has been operational since
September 9, 2015. 80 FR 54305. This regulation identifies the
mandatory, conditional, and optional data elements and who is required
to transmit the data. The regulation also adds seven mandatory data
elements to be provided and presented as the initial filing as early as
practicable, but no later than 24 hours prior to departure of the train
and one conditional data element to be presented as soon as it is
available.
For CBP, the requirement to transmit an electronic export manifest
will enhance cargo security because it improves risk assessment
capabilities at the port level. Port operations will enjoy considerable
efficiencies through the elimination of paper manifests. Storage space
currently reserved for manifest documents will be freed. Coordination
and information exchange among CBP, the Department of Commerce, and
other partner government agencies with export jurisdiction will
improve. Carriers, USPPIs, NVOCCs, and other interested parties who
transmit information will receive more thorough and rapid examination
decisions from CBP. The trade will benefit through the ease of making
information corrections and additions electronically, a process that
requires cumbersome manifest discrepancy reporting in a paper world.
CBP uses the ACE Export Manifest data transmission, for instance,
to conduct risk assessments to identify high-risk rail cargo, but even
for this purpose, ``high risk'' is not limited to weapons, ammunition,
currency or narcotics. High-risk shipments are identified based on the
totality of the review which includes the party name, country of
destination, cargo description, and/or a combination of data elements.
Data supports the conclusion that Test participants have access to the
manifest data early in the planning stages of an export rail cargo
transaction and are able to comply with these time frames. Where
concerns were revealed through comments received after the NPRM was
published, CBP adjusted certain factors required to be included within
the initial filing. CBP added a conditional data element to the
regulation, previously a mandatory element, the AES Exemption
statement, and amended it to, AES ITN or FTR exemption/exclusion code
based on the comment that filers may not have such information to meet
the initial filing requirement at the 24-hour mark. CBP recognized that
this was a distinct possibility and therefore amended the regulation in
this final rule. As stated, CBP anticipates that these timeframes will
provide adequate time to perform proper risk assessments and
identification of shipments to be inspected early enough in the supply
chain to enhance security while minimizing disruption to the flow of
goods. Current regulations do not provide any method to screen or
secure rail cargo exports, which this regulation seeks to address. ACE
Export Manifest pre-departure data transmission allows CBP to use its
ATS to screen all of the data transmitted, which allows CBP to make
better examination decisions while also reducing the time required to
make such decisions. Although CBP aims to identify shipments for
inspection prior to loading, inspections could potentially happen at
any time before the train departs the United States.
Any rail cargo identified by CBP as requiring review will be held
until the required additional information related to the shipment is
transmitted to clarify non-descriptive, inaccurate, or insufficient
information, a physical inspection is performed, or some other
appropriate action is taken, as specified by CBP. Once the cargo is
cleared for loading, a release message will be generated and
transmitted to the filer.
V. Discussion of Final Rule
CBP is promulgating a new regulation, 19 CFR 123.93, requiring the
transmission of export manifest data electronically in ACE for cargo
transported by rail, pursuant to section 343(a) of the Trade Act. The
regulation mandates the electronic transmission of rail export manifest
information, identifies the parties eligible to transmit information,
describes the time frames prior to departure of the train in which the
information is due, requires a bond to secure compliance with the new
regulation, and identifies an initial filing that must occur as early
as practicable, but no later than 24 hours prior to departure from the
U.S. port of export while requiring the remaining data to be
transmitted at least two hours prior to such departure.
Further, consistent with section 343 of the Trade Act, this new
regulation requires parties with the most direct knowledge to provide
certain information to CBP. In furtherance of that goal, the regulatory
language sets forth differences between transportation data (always
required of the carrier and carrier only) and cargo data, which can be
provided by the party with direct knowledge of that information.
Consistent with the provisions of 19 U.S.C. 1415(a)(3)(B), when
requiring information from the party with direct knowledge of the
information is not practicable, the regulation takes into account how,
under ordinary commercial practices, information is acquired by the
party on which the requirement is imposed and whether and how such
party is able to verify the information. Where information is not
reasonably verifiable by the party, the regulation permits the party to
transmit
[[Page 55177]]
information on the basis of what it reasonably believes to be true.
The regulation designates information as transportation data, cargo
data, or empty container data, and lists the data elements to be
transmitted while identifying them as mandatory, conditional, or
optional. The data elements that are identified as mandatory must be
transmitted. These elements are necessary for CBP to inspect cargo
effectively, ensure compliance with U.S. export control laws and
regulations, and identify high-risk shipments for purposes of ensuring
cargo safety and security. Data elements that are identified as
conditional must be provided if applicable. Data elements identified as
optional provide additional information for purposes of clarity and may
facilitate the clearance process but are not required to be
transmitted.
The regulation provides direction regarding enforcement referrals,
DNL messages, and Hold messages. Any rail cargo identified by CBP as
requiring review will be held until the required additional information
related to the shipment is transmitted to clarify non-descriptive,
inaccurate, or insufficient information, a physical inspection is
performed, or some other appropriate action is taken, as specified by
CBP. If the cargo is cleared for loading, a release message will be
generated and transmitted to the filer(s). If a potential high-risk
cargo is identified, then a CBP officer will conduct an examination.
The rail carriers, and any other filers, will be notified of these
holds through the integrated system if a mandatory examination of the
cargo and/or freight car is required or if CBP needs to conduct further
review of the data transmitted. In addition to holds, if a CBP officer
determines during review that cargo or a rail car may contain a
potential threat to the train and its vicinity, a DNL instruction will
be issued, which prohibits the rail carrier from transporting that
cargo or railcar. The rail carrier should not transport any cargo or
rail car with a DNL instruction. The advance transmission of EEM data
helps CBP review and issue holds before cargo is loaded, or before a
train reaches the U.S. port of export, thus facilitating a more
efficient export process.
Specifically, CBP is requiring seven data elements, characterized
as an initial filing, to be transmitted as early as practicable, but no
later than 24 hours prior to train departure. As a result of comments
received, CBP amended the initial filing to include an AES ITN or FTR
exemption/exclusion code as a conditional element recognizing that such
information may not be available to the filer at the 24-hour mark.
Because compliance is CBP's goal, CBP changed this data element to be
conditional and must be transmitted as soon as it is available. CBP
replaced the seventh original data element with EIN or IRN or CBP
assigned number which was another suggestion based upon comments
received from the NPRM. Recognizing that there is more than one type of
bond that may be used to secure legal compliance, it is important that
CBP records the party transmitting the information to verify that that
party has at least one of the required bonds on file. Therefore, CBP
added this requirement as the seventh initial data element as well as a
mandatory element within transportation and cargo data. The seven data
elements chosen for mandatory transmission at least 24 hours prior to
departure are those data elements that provide CBP with the cargo
information it needs to perform the appropriate security analysis,
including: Bill of Lading Number, Total Quantity, Total Weight, Cargo
Description, Shipper's name and address, Consignee name and address,
and EIN or IRN or CBP assigned number. The AES ITN or FTR Exemption/
Exclusion Statement, which is another security-based data element, is
another conditional data element to be supplied if and when it is
obtained by the filer.
The rule provides for the transmission of transportation,
conveyance, and empty container information two hours prior to
departure of the train rather than two hours prior to loading (or on
assembly of the train in the case of information pertinent to empty
rail cars). This change in transmission timing for all other data
elements combined with the initial transmission affords CBP the ability
to better assess risk and effectively target and inspect shipments
prior to the cargo departing the United States to ensure cargo safety
and security.
A. Eligible Parties
Section 123.93(c) identifies the parties that can file the cargo
and conveyance data. The outbound carrier is responsible for
transmitting export manifest transportation data and empty container
data. The outbound carrier must also transmit the initial filing data
and the export manifest cargo data if no other eligible party elects to
do so. If another eligible party elects to transmit either the initial
filing data or export manifest cargo data, the outbound carrier may
also choose to, but is not required to, transmit such data. Other
eligible parties include the USPPI and FPPI, as defined by the
provisions of section 30.1 of the FTR of the Department of Commerce,
Bureau of the Census (15 CFR 30.1), or its authorized agent. Other
eligible filers also include any other party with direct knowledge of
the export information, such as a customs broker, ABI filer, NVOCC as
defined by 19 CFR 4.7(b)(3)(ii), or a freight forwarder as defined in
19 CFR 112.1. Based upon comments received, CBP changed proposed 19 CFR
123.93(a) to clarify that filing EEM data does not constitute customs
business, as defined in 19 U.S.C. 1641(a)(2). If another party does not
transmit advance export information, then the party that arranges for
and/or delivers the cargo to the outbound carrier must fully disclose
and present to the outbound carrier the data elements for the initial
filing. Any party transmitting any of the data described in sections
123.93(d)-(f) must have on file with CBP either a CBP basic importation
and entry bond containing the provisions found in 19 CFR 113.62, a
basic custodial bond containing the provisions found in 19 CFR 113.63,
or an international carrier bond containing the provisions found in 19
CFR 113.64.
B. Initial Data Elements
Different from the Test's time periods for data presentation, 19
CFR 123.93 requires a mandatory initial filing of seven data elements
identified below to be transmitted as early as practicable, but no
later than 24 hours prior to departure from the U.S. port of export, by
either the carrier, USPPI, or other qualified parties or their
authorized agents. As reflected in 19 CFR 123.93(b)(1), CBP determined
that requiring this initial filing in the time frame prescribed is
necessary to allow for complete vetting of cargo and transportation
information for security purposes. The high percentage of data
available for transmission 24 hours prior to departure supports the
feasibility of requiring this initial filing. In further support of
this approach, CBP intends to relax validations that relate to
transportation data until the carrier links the master bill and house
bill to allow for the transmission of advance data. Upon receipt of the
initial filing transmission, CBP will validate and notify the filer of
the master bill and house bill data, if any data is required, or if the
house bill has been placed on hold pending the updating of the bill.
Under the new regulation, the carrier will have the ultimate
responsibility to load, hold, or not load the cargo. The carrier,
USPPIs, and other parties qualified to transmit data (or their
authorized agent) will be eligible to transmit the initial data filing
as discussed above.
[[Page 55178]]
CBP added 19 CFR 123.93(d) which identifies the seven data elements
from the Test that are required in the mandatory initial filing.
Descriptions of those data elements were revised in the proposed rule
to clarify the kind and character of data that is required. The revised
data elements have been further amended based upon comments received
from the NPRM for the initial filing to identify the party transmitting
the information and provide for additional time in the situation where
an AES ITN or FTR exemption/exclusion code are not available at the 24-
hour mark. Below are the data elements with the Test data elements to
which they correspond in brackets:
(1) Bill of lading number, which is necessary to link the
transmission to the cargo throughout the entire electronic manifest
process;
(2) The numbers and quantities of the cargo laden aboard the train
as contained in the carrier's bill of lading, either master or house,
as applicable (this means the quantity of the lowest external packaging
unit; numbers or quantities of containers and pallets do not constitute
acceptable information; for example, a container holding 10 pallets
with 200 cartons should be described as 200 cartons) [Test data element
of Quantity of Cargo and Unit of Measure];
(3) Total weight of cargo expressed in pounds or kilograms [Test
data element of Weight of Cargo (may be expressed in either pounds or
kilograms)];
(4) A precise cargo description (or the Harmonized Tariff Schedule
(HTSUS) number(s) to the 6-digit level under which the cargo is
classified if that information is received from the shipper and weight
of the cargo; or for a sealed container, the shipper's declared
description and weight of the cargo (generic descriptions, specifically
those such as ``FAK'' (freight of all kinds), ``general cargo'', and
``STC'' (said to contain) are not acceptable)) [Test data element of
Cargo Description];
(5) The shipper's complete name and address, or identification
number, from the bills of lading (for each house bill in a consolidated
shipment) [Test data element of Shipper name and address];
(6) The consignee's complete name and address, or identification
number, from the bill(s) of lading. (The consignee is the party to whom
the cargo will be delivered in a foreign country. However, in the case
of cargo shipped ``to order of [a named party],'' the ``to order''
party must be named as the consignee; and if there is any other
commercial party listed in the bill of lading for delivery or contact
purposes, the carrier must also report this other commercial party's
identity and contact information including address in the ``Notify
party'' field.) [Test data element of Consignee name and address];
(7) EIN or IRN or CBP assigned number. [Data element recommended by
commenter]; and
Conditional data. The following initial data is conditional and
must be transmitted if and as soon as applicable. The AES ITN or FTR
exemption/exclusion code. [Test data element of AES Exemption Statement
(per shipment)].
Except for these eight data elements described above, CBP requires
electronic export manifest information in sections 123.93(e), and (f)
to be transmitted two hours prior to train departure from the U.S. port
of export. That data comprises all additional data elements required to
be described as export manifest transportation data, cargo data, and
empty container data.
C. Transportation Data Elements
Section 123.93(e)(1) establishes the obligation on the carrier or
its agent to supply transportation data. The transportation data
elements carried forward from the Test to the current rule include the
following:
(1) Port of Departure from the United States (mandatory);
(2) Date of Departure (mandatory);
(3) Mode of Transportation (containerized rail cargo or non-
containerized rail cargo) (optional);
(4) Equipment Type Code (optional);
(5) Place where the rail carrier takes possession of the cargo
shipment or empty rail car (optional);
(6) Carrier-assigned conveyance name, equipment number and trip
number (mandatory);
(7) 6-character Hazmat Code. (If the Hazmat Code is provided, then
UN (for United Nations Number) or NA (North American Number) and the
corresponding 4-digit identification number assigned to the hazardous
material must be provided.) (conditional);
(8) Marks and Numbers (conditional);
(9) SCAC (Standard Carrier Alpha Code) for the exporting carrier
(mandatory);
(10) Container or Equipment Numbers (for containerized shipments)
or Rail Car Numbers (for all other shipments) (mandatory);
A transportation data element carried over from the Test to section
123.3(e) with an expanded definition is as follows:
Seal Number (conditional, only required if container was sealed).
The seal numbers for all seals affixed to containers and/or rail cars
to the extent that CBP's data system can accept this information (for
example, if a container has more than two seals, and only two seal
numbers can be accepted through the system per container, electronic
presentation of two of these seal numbers for the container would be
considered as constituting full compliance with this data element).
In 19 CFR 123.93(e), CBP added the transportation data element of
``Estimated Time of Departure'' (mandatory) to be supplied by the
carrier or its agent that was not required in the Test but provides
important information to CBP.
Based upon comments received from the NPRM, CBP clarifies that 19
CFR 123.93(e)(1)(ii), date of departure, means the date that the train
crosses the international border.
Final 19 CFR 123.93(e)(1)(v), which adds the mandatory
transportation data element of ``Train Consist,'' provides CBP with
what is on the train from the engine through the last car and how the
cargo is lined up for departure from the United States. The Train
Consist is composed of the following data elements that were required
in the Test and remain in the regulation:
(1) Manifest Number
(2) Train Number
(3) Rail car order
(4) Empty containers.
D. Cargo Data Elements
Section 123.93(f) establishes the obligation to transmit manifest
cargo data by any eligible party or its agent identified in section
(c). The cargo data elements carried forward from the Test to the rule
in addition to the seven data elements forming the initial data filing
include the eighteen data elements listed below. CBP recognizes that
some cargo data elements are already requested in the initial data
filing; however, those data elements would not need to be transmitted
again unless there are updates or changes made. While a comment was
received asking about the deadline for updating information, CBP has
chosen not to insert a deadline as the most relevant and updated
information will always be sought. The final cargo data elements are as
follows:
(1) Shipper name and address (for empty rail cars, the shipper may
be the railroad from whom the rail carrier received the empty rail car
to transport) (mandatory);
(2) Consignee name and address (for empty rail cars, the consignee
may be the railroad to whom the rail carrier is transporting the empty
rail car) (mandatory);
(3) Port of Lading (mandatory);
[[Page 55179]]
(4) Port of Unlading (mandatory);
(5) Bill of Lading Type (Master, House, Simple, or Sub)
(mandatory);
(6) Bill of Lading Numbers (Master, House, Simple, or Sub)
(mandatory);
(7) AES ITN or In-bond Number (per shipment) (mandatory);
(8) Cargo description (mandatory);
(9) Weight of cargo (may be expressed in either pounds or
kilograms) (mandatory);
(10) Quantity of cargo and unit of measure (mandatory);
(11) Employer Identification Number (EIN) or Importer Record Number
or CBP assigned number (mandatory)
(12) In-bond type (conditional);
(13) Notify party name and address (conditional);
(14) Secondary notify party name and address (conditional);
(15) Mexican Pedimento Number (only for shipments for export to
Mexico) (optional);
(16) Secondary notify party SCAC (optional);
(17) Country of ultimate destination (optional); and
(18) Number of house bills of lading (optional).
E. Examination Referrals
Two types of referrals may be issued by CBP after a risk assessment
of an outbound export manifest data transmission, pursuant to 19 CFR
123.93(g). A referral for information will be delivered to the data
transmitter, the last party to file the outbound rail manifest data for
which referral is sought, if the information provided fails to
appropriately describe the cargo or if the information provided is
inaccurate or insufficient. The data transmitter must then add or
correct the information prior to the departure of the train from the
United States. A referral for screening will be issued if the potential
risk of the cargo is deemed high enough to warrant enhanced screening.
In this instance, the rail carrier is notified of these holds, and the
notification lets the rail carrier know that a mandatory examination of
the cargo and or freight car is required or if CBP needs to conduct
further review of the data transmitted.
F. Do-Not-Load (DNL)/Hold Instructions
CBP is also adding 19 CFR 123.93(h), which provides procedures for
when a CBP officer determines during the review that cargo or a rail
car may contain a potential threat to the train and its vicinity, so
that a DNL instruction can be issued, which prohibits the rail carrier
from transporting that cargo or rail car. The rail carrier should not
transport any cargo or rail car with a DNL instruction. A Hold
instruction will be issued, even after loading, if further examination
is required. In order to address such issues, data transmitters must
respond and fully cooperate when such an instruction or hold is issued.
Based upon comments received in the NPRM, CBP removed the requirement
that telephone numbers and email addresses be provided because the
system will electronically and automatically transmit to the rail
carrier and any other transmitter. CBP has changed section
123.93(h)(1)-(3) to clarify that if there is any other filer, in
addition to the rail carrier, all filers will be notified
electronically of such an issue. It is incumbent upon all parties who
receive a DNL/Hold instruction to contact CBP at the port of export.
G. Other Technical Amendments to Part 123
Because CBP is adding new subpart J, CBP is revising the scope
provision of the new regulation (19 CFR 123.0) to reflect that customs
procedures at the Canadian and Mexican borders would include electronic
information for cargo in advance of departure which is not addressed in
the current regulation.
H. Proposed Amendments to CBP Bond Conditions
As an enforcement tool, CBP is also changing the relevant bond
provisions in 19 CFR 113.62 (basic importation and entry bond), 19 CFR
113.63 (basic custodial bond), and 19 CFR 113.64 (international carrier
bond) to provide CBP with authority to assess liquidated damages when
parties do not provide the mandatory EEM data in the manner and in the
time frame required. Specifically, CBP amends 19 CFR 113.62 to add new
paragraph (k)(3) to address electronically provided outbound
information. Section 113.62(k) currently addresses electronic
transmissions for merchandise or cargo which is inbound. CBP also
amends 19 CFR 113.63(g) to include reference to advance outbound
information provided to CBP electronically and in the manner and in the
time period required under 19 CFR 123.93. Finally, CBP amends 19 CFR
113.64(d) to include outbound reference to information provided
electronically by international carriers in the manner and time period
required under 19 CFR 123.93. CBP has amended certain language in
section 113.64(d) so that CBP can rely on that section to enforce
violations in other modes of transportation without further amendment
in the future. CBP is not amending section 113.64(e) because that
provision, as already promulgated, provides for enforcement of
violations when advance outbound information is not provided to CBP
electronically and in the manner and in the time period required under
19 CFR 123.93. With each of these regulations, CBP may assess
liquidated damages if a violation occurs. Any party that violates the
bond conditions for outbound data transmission as described above in
this final rule agrees to pay liquidated damages of $5,000 for each
violation and up to a maximum of $100,000 per departure. CBP notes that
the $100,000 per departure cap on liquidated damages applies only to
international carrier bonds (19 CFR 113.64), and not to basic
importation and entry bonds (113.62) or basic custodial bonds (113.63).
This distinction reflects longstanding regulatory practice and is based
on the different types of obligations secured by each bond.
International carrier bonds secure obligations related to the movement
of conveyances, such as trains, vessels, or aircraft, and the cap is
intended to limit liability for each discrete movement. In contrast,
basic importation and entry bonds and basic custodial bonds secure
obligations that may involve the full value of imported merchandise or
the custody and control of goods, where no per-movement cap is
appropriate. Compliance is CBP's goal and CBP aspires to work alongside
rail carriers and other parties to ensure that trade members provide
the proper data in a timely manner, so that CBP can properly review the
data, conduct risk assessment of high-risk shipments, and enforce U.S.
export laws and regulations on U.S. rail exports. Consistent with this
approach, CBP will begin enforcing this rule on October 26, 2027.
I. Severability
CBP intends for the requirements contained in this rule to be
severable from each other and to be given effect to the maximum extent
possible, such that if a court holds that any provision is invalid or
unenforceable--whether in their entirety or as to a particular entity
or circumstance--the other provisions will remain in effect as to any
other person or circumstance.\7\ The various requirements in this final
rule are designed to function sensibly without the others, and CBP
intends for them to be severable so that each can operate
independently.
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\7\ Courts have uniformly held that the APA, 5 U.S.C. 706(2),
authorizes courts to sever and set aside ``only the offending parts
of the rule.'' Carlson v. Postal Regulatory Comm'n, 938 F.3d 337,
351 (D.C. Cir. 2019); see, e.g., K Mart Corp. v. Cartier, Inc., 486
U.S. 281, 294 (1988).
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[[Page 55180]]
For example, CBP would intend to be able to implement as much of
the rule as possible, even if it could not implement some of the rule
(such as a conditional data element) due to a court order. This
approach ensures that CBP can make necessary security improvements to
the greatest extent possible.
Even if a court order were to render the requirement to transmit a
particular data element invalid or unenforceable and EEM transmitters'
responses under that data element inform transmitters' responsibilities
to transmit other data elements, CBP would intend that EEM transmitters
continue to provide the other data elements, using the preamble of this
final rule as guidance for the applicability of any conditions to the
extent this conditionality interpretation does not violate a court
order.
If a stricken provision creates a question of whether or not a
conditional data element should be transmitted, CBP intends that EEM
transmitters would interpret the stricken provision as satisfied such
that transmission of the conditional data element is required.
VI. Discussion of Comments
A. Overview
In response to the NPRM, CBP received eleven comments during the
60-day public comment period. Commenters consisted of individuals,
customs brokers and freight forwarders associations, standards and
compliance organizations, and trade associations. CBP reviewed the
public comments received in response to the rulemaking and has
addressed relevant comments in this final rule. CBP's responses are
grouped by subject area, with a focus on the most common issues and
suggestions raised by commenters. Some commenters expressed support for
the rule and strongly support CBP's efforts to move forward with the
NPRM because it modernizes and helps automate processes, enabling both
trade members and CBP to generate efficiencies in international trade.
These comments also offered suggestions for additional clarity and
improvement. While some commenters expressed general opposition to the
proposed rule citing significant costs, voicing concerns with potential
disruptions to trade flows, bonding requirements, lack of clarity on
certain details, ability to meet certain data reporting requirements
and unnecessary added costs, these commenters also provided some
suggestions for improvement. One commenter strongly opposed the NPRM
and suggested revisions to reduce the impact on its trade members.
Comments submitted regarding any topic other than the proposed rule,
(i.e., comments on topics unrelated to, for instance, EEM data,
process, and costs and benefits of the EEM) are out of scope for this
rule and were not considered.
B. Discussion of Comments
1. Generally Supportive With Suggested Changes/Improvements
Comment: One commenter provided suggested revisions to the
regulation text for section 113.63 and multiple paragraphs within
section 123.93(a), (c), (g), and (h) to simplify the language and
improve clarity.
Response: CBP appreciates the comment, but considers the language
used to be clear and concise, and therefore CBP is not making the
suggested edits.
Comment: One commenter who was supportive of the rule suggested
that CBP should offer financial or technical assistance to small and
medium sized rail carriers who are likely to face difficulties in
adopting new digital infrastructure.
Response: CBP appreciates the positive feedback. Additionally, CBP
plans to provide compliance resources and technical assistance to all
interested parties, including rail carriers, during the transition to
providing EEM data to CBP.
Comment: A few commenters requested that CBP ensure that the rail
manifest process aligns with the ocean manifest process, particularly
in determining the data element used to connect an NVOCC's submission
to the rail or ocean manifest.
Response: CBP agrees with the comment and states that CBP strives
to align the EEM process to the extent feasible for all modes of
transportation which are the subject of separate rulemakings.
Comment: One commenter suggested that CBP align the proposed rule
with internationally recognized standards, particularly those related
to the use of the commenter's suggested identifiers for tracking and
identifying cargo. The commenter cited ``GS1 identifiers (e.g., Global
Trade Item Numbers [GTINs] and Serial Shipping Container Codes [SSCCs])
for tracking and identifying cargo'' (brackets are the commenter's).
The commenter wrote that these globally unique identifiers are widely
used across the industry and can be leveraged to support enhancing data
accuracy, interoperability and efficiency. The commenter added that
``GS1 data carriers (e.g., GS1-128 barcodes and RFID tags) and GS1
standards for data sharing (e.g., EDI/XML, EPCIS) can be utilized'' and
that use of such standards ``would ensure harmonization with global
trade systems and enhances interoperability, ultimately reducing costs
and paperwork while improving operational efficiency for all
stakeholders involved in the export process including, but not limited
to, rail carriers and exporters.''
Response: CBP appreciates this comment and CBP's goal is to align
with recognized standards, but CBP believes its use of the Automated
Commercial Environment (ACE) as the platform for the electronic export
manifest and specific data elements, which are internationally
recognized, meets the standards being utilized by other trade systems.
Comment: One commenter supportive of the rule requested that CBP
adopt data quality standards that ensure that all required information
is provided in an accurate and timely manner, thus reducing the
potential for costly delays and non-compliance issues.
Response: CBP agrees and notes that as shown in the NPRM and this
final rule, CBP has adopted standards which provide the best
information in an orderly and accurate manner.
Comment: A number of commenters request that CBP allow sufficient
time and a transition period for trade members to prepare for full
implementation, specifically for them to adjust business practices and
adjust their systems such that they can provide the EEM data to CBP.
Response: CBP understands the concerns from these comments and in
response will make this rule effective 60 days after the date of
publication; however, enforcement will not begin for at least one year
to allow the trade members a period of transition so they may prepare
for full implementation. Additionally, CBP notes that its primary goal
is compliance and seeks to work alongside rail carriers and other
parties to ensure that the proper data is provided in a timely manner,
for CBP to properly review the data, conduct risk assessment of high-
risk shipments, and enforce U.S. export laws and regulations on U.S.
rail exports.
2. Issues With Eligible Parties
Comment: A number of commenters expressed concern about the
specific list of parties eligible to participate in the rail EEM,
specifically commenters stated that the USPPI, FPPI, customs brokers
and ABI filers were not likely to be EEM filers. Some of the commenters
suggested that CBP should remove references to the FTR except in
instances where the EEM filing must connect with the EEI filing. These
[[Page 55181]]
commenters reasoned that because reporting requirements under the FTR
are different, distinguishing between FTR requirements and EEM
requirements is important to avoid confusion about who is responsible
for the EEM filing.
Response: CBP emphasizes that the regulatory language describes who
is eligible to file and does not gauge whether the eligible filers will
or will not engage in this data transmission activity. Any of these
parties could be the party that has direct knowledge of the
information, and the regulation will not exclude them from eligibility.
CBP has added language to section 123.93(a) to clarify that the act of
transmitting EEM is not customs business, but brokers will still be
eligible to file EEM. Because USPPIs and FPPIs may be filers, the FTR
language will stay in this rule.
Comment: One commenter, who was generally supportive of the rule,
asked for additional clarity on which parties are responsible for
filing export manifest cargo data, specifically whether each of the
NVOCCs with house bills are required to file EEM data or only the
lowest level house bill filer must do so.
Response: CBP has afforded the export filers choices as to whether
to take responsibility over the transmission of data pertaining to a
shipment. While the outbound rail carrier is the default transmitter,
other parties may step forward and take responsibility for data
transmission. CBP only seeks a party with knowledge of the shipment to
be the transmitter; any eligible party may transmit the data. In any
situation, CBP encourages the party with the most direct knowledge of
the cargo to provide accurate and complete cargo data either directly
to CBP as an EEM participant or to another party that will act as the
EEM participant.
3. Availability of Filing Parties
Comment: A number of commenters were concerned about the
requirement that the EEM ``transmitter'' must have 24/7 access to the
phone number and email address provided on the EEM transmission. They
suggest that the rail carrier should be the entity required to monitor
a phone and email address 24/7, not the house-level filers. One
commenter specifically suggested that the house-level filers need not
have the same level of availability to CBP as the rail carriers.
Response: CBP understands the concern of the commenters and is
adjusting the language of the regulatory text in sections 123.93(h)(1)
through 123.93(h)(3) as part of this final rule to reflect this
concern. All parties who transmit EEM data will be notified, should an
instruction of Do-Not Load (DNL) or Hold be issued. CBP will update the
regulatory text to include all transmitters and/or outbound rail
carriers, as applicable, must respond and fully cooperate when a DNL or
Hold instruction is issued. The parties that receive such instructions
must contact CBP at the port of export. The party with physical
possession of the cargo will be required to carry out the DNL or Hold
protocols and the directions provided by law enforcement authorities.
It is incumbent on the parties who have received a DNL or Hold
instruction to contact CBP at the port of export.
4. Data Changes
Comment: Several commenters requested further guidance on section
123.93(b)(3). In the NPRM, CBP states that updates are required ``upon
discovery of data changes,'' but it does not specify a timeframe for
when such updates must be made. The comments recommend that CBP should
provide further guidance on whether there is a cutoff period for
updates, particularly in cases where discrepancies are identified long
after departure, such as during an audit conducted after delivery,
perhaps after a year or more.
Response: CBP appreciates this comment, but CBP sees value in
allowing trade members to update export manifest data at any time in
the future, which is consistent with CBP treatment of import manifest
data. This approach is similar to Foreign Trade Regulations at 15 CFR
part 30 which also seek updates without time constraints. Specifically,
under those regulations, ``corrections, cancellations, or amendments to
. . . information shall be electronically identified and transmitted .
. . for all required fields as soon as possible.'' 15 CFR 30.9(a).
5. Bond Conditions
Comment: A few commenters were concerned with proposed section
113.62 (k)(3) which states ``If the principal elects to provide advance
outbound information to CBP electronically, the principal agrees to
provide such information in the manner and in the time period required
under section 123.93 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.'' These commenters recommend that this be removed as the
basic importation and entry bond is not applicable to the parties who
will be transmitting EEM filings.
Response: CBP believes that this recommendation is inconsistent
with the statutory provisions governing the transmission of advance
electronic cargo information. The information can come from a party
with direct knowledge of that information, who may be the principal on
a basic importation and entry bond. CBP does not limit the transmitter
by role but rather by knowledge of the information. To ensure accuracy,
CBP permits any party with that knowledge to come forward and transmit
the required electronic export manifest information, but to ensure the
electronic export manifest regulations are complied with, the
transmitter must have a bond on file.
Comment: One commenter stated that it is not appropriate to include
export-related obligations within the bond conditions controlling
importation or entry of merchandise. The commenter suggests that a new
subsection be created to incorporate bond conditions that ensure
compliance by parties that elect to file, or are required to file,
export-related information in accordance with CBP regulations.
Commenters further argued that imposing export-related obligations
within import bond conditions could create practical problems. For
example, one commenter explained that export cargo is often unrelated
to imported merchandise, so requiring export filers to use bonds
designed for imports is ``contradictory and out of place.'' Some
commenters wrote that parties such as shippers, consignees, or freight
forwarders may not have, or may not wish to use, import bonds for
export filings. They cited the Importer Security Filing (ISF) process,
where CBP created a separate bond appendix for parties without standard
bonds, and suggested a similar approach for export manifest filings. A
commenter wrote that requiring export filers to obligate import bonds
could force them to obtain unnecessary bonds or create confusion when
multiple bonds are active.
Response: The statutory framework of section 343 of the Trade Act
of 2002, as amended (19 U.S.C. 1415) addresses both import and export
making the inclusion of bonds consistent with the statutory text. Under
Trade Act of 2002, when CBP requires the provision of advance
electronic export cargo information, CBP shall impose the requirement
on the party most likely to have direct knowledge of the information.
The rail electronic export information requirements described in the
rule are consistent with this statutory framework as they seek the
information from the party best positioned to have it. The rule
[[Page 55182]]
encourages transmission by the party most likely to have direct
knowledge of the information, and the current bond structure is
sufficient to ensure compliance with it, with the amendments to the
bonds made in this rule. When a party holding a Basic Importation and
Entry Bond has this information and chooses to provide it, having a
consolidated bond that secures the party's compliance with this rule,
rather than requiring a new, separate bond, is the best way to ensure
the information transmitted is accurate and timely and involves less
cost to the transmitter and less administrative burden on all parties.
Furthermore, CBP directs the commenter to 19 CFR 113.64 which has
imposed export-related obligations within import bond conditions; this
regulation became effective on February 18, 1985 (49 FR 41171). For
instance, under 19 CFR 113.64(j), an agreement to deliver export
documents provides that ``[i]f the principal's vessel, vehicle, or
aircraft is granted clearance without filing a complete outward
manifest and all required export documents, the principal agrees to
file timely the required manifest and all required export documents.''
Section 113.64(m)(1) states that the ``[p]rincipal agrees that it will
not allow seized or detained merchandise, marked with warning labels of
the fact of seizure or detention, to be placed on board a vessel,
vehicle, or aircraft for exportation or to be otherwise disposed of
without written permission from CBP, and that if it fails to prevent
such placement or other disposition, it will redeliver the merchandise
to CBP within 30 days, upon demand made within 10 days of CBP discovery
of the unlawful placement or other disposition.''
Finally, CBP does not want to create a separate bond when the new
provisions can be absorbed within the current bond structure. Many
parties wanting to transmit information already hold a CBP bond and
will not be required to incur the expense of acquiring a separate bond
to handle export transactions only.
Comment: One commenter suggested that if CBP anticipates more than
one bond activity code may be used for the rail EEM, it will be
important that CBP records the party transmitting the information and
specify the bond the filer intends to obligate. The commenter suggests
that CBP could add an additional data element for the identification of
the filing party and filer's bond being obligated in each of the three
categories of data elements: sections 123.93(d) (used for the initial
filing), 123.93(e) (used for transportation data), and 123.93(f) (used
for cargo data). The commenter further suggests that these three
subsections should also include a mandatory data element that
identifies the filer's bond being obligated because it is not uncommon
for outbound carriers, or non-carrier information filers (e.g.,
shipper, consignee, freight forwarder, etc.), to have multiple active
continuous bonds that would contain export rail manifest-related bond
conditions. Lastly, the commenter suggests that, as is done with the
Importer Security Filings, the information filer should identify the
bond that it chooses to secure its filing obligations.
Response: CBP appreciates these suggestions and believes adding the
transmitter's identifying information as a data element will assist CBP
in identifying the transmitter's required bond. As such, CBP will add a
new data element for the transmitter's identifying information to
sections 123.93(d)(1)(vii) for the initial filing, 123.93(e)(1)(viii)
for transportation data, and 123.93(f)(1)(xi) for cargo data. CBP will
determine the obligated bond as follows: if the transmitter has an
active international carrier bond, the transmitter's international
carrier bond will be obligated to secure the filing; if the transmitter
does not have an active international carrier bond but does have an
active basic custodial bond, the transmitter's basic custodial bond
will be obligated to secure the filing; and if the transmitter has
neither an active international carrier bond nor an active basic
custodial bond but does have an active basic importation and entry
bond, the transmitter's basic importation and entry bond will be
obligated to secure the filing. CBP considered the commenter's
suggestion to allow filers to designate which of their bonds to
obligate but has decided to use this standardized hierarchy to promote
administrative simplicity and consistent enforcement.
Comment: One commenter suggested that the expansion of existing
bond conditions in certain sections of Part 113 of the CBP regulations
should be included to ensure compliance by parties that elect to file
or are required to file export information including to ensure clarity
and remove doubt.
Response: CBP appreciates this suggestion and believes that the
addition of the reference to ``(k)(3)'' to section 113.62(n) clarifies
the consequences of default and the calculation of liquidated damages
for each violation.
Comment: One commenter suggested that the proposed rule would
change carriers' bonding requirements and could result in unfair
enforcement against rail carriers because they could conceivably be
liable for liquidated damages based on the transmission of data of
which the carrier did not have direct knowledge. The commenter wrote
that the proposed rule also creates a disincentive for any other data
transmitter to actually transmit the data for which they have the most
direct knowledge because they are not required to submit the data.
Response: The rule treats bonding for exports for rail carriers in
a manner consistent with vessel and air carriers. In all modes, any
party with knowledge may step forward and transmit the necessary data
as long as that party has at least one of the three bonds that are
being amended to secure advance export information. Otherwise, the rail
carrier will be responsible for knowing what is on its train and
transmitting the data required. The bonding structure for outbound rail
transmissions is consistent with all bonding schemes for other modes of
transport. Additionally, as required by section 343 of the Trade Act of
2002, as amended (19 U.S.C. 1415), the regulations provide that, CBP
will take into consideration how, in accordance with ordinary
commercial practices, a rail carrier acquired the information, and
whether and how the rail carrier is able to verify the information. The
regulations also provide that, where a rail carrier is not reasonably
able to verify such information, CBP will permit the rail carrier to
electronically transmit the information based on what that party
reasonably believes to be true.
6. Issues Regarding Initial Filing
Comment: A few commenters suggested that for ocean shipments routed
via rail (specifically when an NVOCC has an ocean shipment departing
the U.S. via rail to a Canadian or Mexican seaport), CBP utilize the
Vessel Operating Common Carrier (VOCC) master bill of lading as the
linkage point in section 123.93(d) as it would be the least disruptive
and most operationally feasible approach. The commenters stated that
there is no feasible way for the NVOCC to obtain the waybill number
before the initial filing of house-level data.
Response: CBP appreciates the suggestion in these comments;
however, the waybill number exists before the initial filing of house-
level data and trade members may need to adjust business practices to
obtain that information to transmit in the initial filing in order to
comply with this rule. In co-loading scenarios, CBP recognizes
[[Page 55183]]
that master-loader NVOCCs may not have visibility into the lowest-level
house bill data, and CBP expects that, where practicable, the NVOCC
that issued the lowest-level house bill will provide that house-level
data either directly to CBP or through another EEM transmitter.
Comment: A few commenters request additional clarification for
section 123.93(d)(4) regarding potential risks of holds, delays, or
other issues if the cargo description in the EEM does not exactly match
the descriptions in other export documents. The commenters requested
clarification on whether such differences between the EEM and EEI
filings would hinder CBP's targeting objectives or result in shipment
holds, and if so, how such discrepancies should be addressed to ensure
smooth processing.
Response: CBP is interested in the cargo description from a
security aspect, not a statistical one. CBP utilizes both EEM and EEI
in its risk assessment as CBP considers all available data sets which
inform enforcement and facilitation determinations. CBP expects that
the additional data will improve and not hinder CBP objectives.
Comment: A few commenters stated that the requirement in proposed
section 123.93(d)(4), as written, indicates that the description
provided in EEM for a sealed container should be the ``shipper's
declared description'' and asked CBP to clarify whether the ``shipper's
declared description'' should match the description in the bill of
lading. Commenters stated that if the shipper's declared description
should match the description in the bill of lading, the description may
not provide the desired details.
Response: CBP notes that the EEM filer (transmitter) is expected to
meet the requirements of the regulation, and whether or not the
container is sealed is not the controlling factor in providing that
data. CBP expects that the party with the most direct knowledge of the
house-level bills will provide the EEM data either directly to CBP or
to another party which will transmit the EEM data to CBP.
Comment: A few commenters requested additional clarification for
sections 123.93(d)(5) and 123.93(d)(6). Commenters requested
clarification on what constitutes an acceptable ``identification
number'' for the shipper and consignee, noting that using an EIN may
not correspond to the party listed on the bill of lading and that there
is no standard identification number for foreign consignees. The
commenters noted that the consignee field in a bill of lading can vary,
creating potential uncertainty in reporting.
Response: CBP appreciates the comment and acknowledges the
potential uncertainty. To address this concern, CBP will remove
``identification number'' from sections 123.93(d)(5) and 123.93(d)(6),
and both sections are restructured to sections 123.93(d)(1)(v) and
123.93(d)(1)(vi) in this final rule.
Comment: A few commenters suggested that CBP adjust language in
section 123.93(d)(7) to include ITN or FTR exemption/exclusion codes.
These commenters further suggested that CBP should accept initial
filing even when the AES, ITN, or FTR exemption/exclusion statement is
not yet available. Commenters suggested CBP move this data element to
the mandatory cargo data section, allowing an NVOCC to transmit it in
the initial filing when available or as part of a supplemental filing
at a later time, as long as it remains within the required transmission
timeframe. The commenters ask CBP to verify that appropriate processes
are in place to ensure rail carriers' manifest filings can accommodate
all applicable ITNs and exemption/exclusion statements.
Response: CBP acknowledges this concern and as a result will amend
section 123.93(d) of the initial filing to include both mandatory and
conditional elements in this final rule. CBP is revising this provision
such that the data element ``The Automated Export System (AES)
Exemption Statement, as applicable'' is amended to conditional and
revised to state that ``AES, ITN, or FTR exemption/exclusion code must
be transmitted if, and as soon as, applicable.''
Comment: One commenter suggested that there is no need to have the
initial data elements transmitted 22 hours prior to the transportation
data elements and cargo data elements. Rail carriers may have a rail
yard that is only an hour or two from the point of export, or where a
train maybe traveling to Canada and may have to pick up cars for export
along the way. In this case, the rail carrier will construct the train
and transmit the initial filing and then need to hold the train for
over 20 hours in the yard or somewhere else less secure between the
yard and the point of export. The commenter also remarks that this was
not how the Test program worked and suggested that transmission time
for all three data elements should be aligned at two hours prior to
departure from the country.
Response: CBP disagrees as the deadlines for data elements are
based on hours prior to the train departure from the U.S. port of
export, not crossing the border. 19 CFR 123.93(d) requires an initial
filing of eight data elements (7 mandatory and 1 conditional)
identified to be transmitted as early as practicable, but no later than
24 hours prior to departure from the U.S. port of export, by either the
carrier, USPPI, or other qualified parties or their authorized agents.
The results of the Test have shown that some rail carriers will have
the export manifest data available days in advance prior to departure
and therefore will have all the necessary information to transmit the
initial filing data to CBP and all other export manifest data well in
advance of the 24 hours prior to departure deadlines. As noted, during
the duration of the Test, CBP has kept such disruptions to a minimum.
Comment: One commenter suggested that the rule will create major
disruptions for railroads. The commenter argued that:
Because the rule prohibits carriers from transporting
cargo subject to a DNL or Hold instruction, and because CBP will only
know whether to issue such an instruction after it has received and
reviewed all three sets of data (initial filing at 24 hours, and
transportation and cargo data at 2 hours before departure), carriers
would in practice need to hold trains until CBP has completed its
review and communicated whether any DNL/Hold applies.
Moreover, according to the commenter, it appears that a
referral or DNL/Hold decision will be made by CBP after all data
elements are collected from the data transmitters.
As a result, export trains assembled in a yard could be
forced to sit for more than 24 hours while awaiting CBP's review and a
de facto ``all-clear,'' which is inconsistent with how rail yards are
designed--i.e., for high throughput and minimal dwell time.
The commenter further stated that if trains or cars must
be held at or near border crossings for inspections triggered by DNL/
Hold decisions or referrals, this would require complex switching or
live-lift operations at locations that often have single-track
constraints and limited infrastructure, causing cascading delays and
missed ``slots'' for both export and other traffic on the line.
In the commenter's view, these effects would substantially
increase dwell time, force carriers to redesign their train-slotting
practices, and decrease overall network fluidity.
The commenter stated that the timing of data set transmissions is
also problematic as there is no need to have
[[Page 55184]]
the initial data elements transmitted 22 hours prior to the
transportation data elements and cargo data elements.
Response: CBP notes that the outbound electronic rail manifest
requirements do not obligate carriers to wait for an affirmative ``all-
clear'' message from CBP prior to movement, and do not obligate CBP to
wait for all data to be submitted before CBP can issue a DNL or Hold
instruction. Under 19 CFR 123.93, carriers must meet the prescribed
filing deadlines and must not transport cargo that is subject to a DNL
or Hold instruction, but they are not required to hold trains solely to
await a separate notification that no such instruction has been issued.
Additionally, CBP notes that feedback obtained from the rail EEM Test
participants indicates they did not experience disruptions while
participating in the Test.
In general, CBP does not anticipate that the final rule will impose
the prolonged yard dwell times, widespread slotting conflicts, or
systemic network disruptions described by the commenter. When EEM data
is provided within the deadlines set forth in this rule, cargo
inspections will be conducted at a U.S. port of export location
determined by CBP. Therefore, CBP anticipates that cargo inspections
occurring between the U.S. port of export and the actual border
crossing would be rare instances where a significant imminent threat is
identified after the train is given clearance and has departed the
United States from the final port of export.
CBP acknowledges that certain ports of export and border crossings
have unique yard and infrastructure constraints such that carriers may
need to adjust operational procedures as needed to minimize unwarranted
disruption.
CBP acknowledges that carriers remain free to build in their own
buffers, but notes that such self-imposed dwell is not required by the
rule and is too speculative for CBP to quantify.
Regarding the commenter's objection to requiring initial data
elements at least 22 hours prior to the transportation and cargo data
elements, this comment is contrary to the long-stated trade desire for
progressive filings when information is known.
Comment: One commenter suggested that CBP's assumption that a 24-
hour transmission timeframe for the initial data elements was based on
a flawed Test program design. The commenter further suggested that CBP
expand its Test program to incorporate different points of export to
learn from real-world experiences how rail carriers operate at the
border and that continuing to expand the Test program could provide for
better outcomes in the long run.
Response: The time frames set out in this rule are a compromise
that allows commerce to flow while providing CBP the ability to
identify risks and to examine cargo in the export process. CBP opened
participation in the Test program to any and all rail carriers as well
as other members of the trade as of 2017. The only limitation was that
participation from rail carriers and other trade members needed to be
voluntary. There were no restrictions with regard to the participant's
organization size, location, or commodity type for participation in the
test. 82 FR at 37894. CBP does not support the idea of further
extending the Test where additional voluntary participation is unlikely
to occur.
7. Date of Departure
Comment: A few commenters requested additional clarification on
section 123.93(e) ``Date of departure''. They stated that CBP does not
specify whether this data element refers to the departure date from the
United States. To ensure consistency and clarity, the data should
explicitly state that it represents the date the train crosses the
international border, leaving the United States.
Response: CBP agrees that for this rule the term ``Date of
departure'' constitutes the date that the train crosses the
international border, exiting the United States.
8. Assistance for Stakeholders
Comment: A number of commenters urged CBP to release an EEM
business process document to allow affected parties to more accurately
formulate compliant and effective business processes internally and
with their business partners.
Response: CBP agrees and intends to cooperate and provide support
to trade members during the transition process where the trade will be
providing EEM data to CBP. CBP agrees that providing an EEM business
process document will be beneficial and intends to provide that
documentation to trade members.
Comment: One commenter requested that CBP engage with supply chain
stakeholders, including manufacturers, distributors, shippers,
exporters, logistics providers, and technology solution developers,
throughout the rulemaking process and provide adequate support and
education on compliance requirements, especially for smaller players in
the supply chain.
Response: CBP has engaged with stakeholders throughout the
rulemaking process and will continue to do so during the implementation
phase of this rule.
9. General Opposition to Rule With Suggested Changes/Improvements
Comment: One commenter who opposed the rule stated that statutory
principles should guide the rulemaking and that ``the requirement to
provide particular information shall be imposed on the party most
likely to have direct knowledge of that information . . . [and] [w]here
information is not reasonably verifiable by the party on which a
requirement is imposed, the regulations shall permit that party to
transmit information on the basis of what it reasonably believes to be
true.''
The commenter suggested that, to comply with the congressional
directive, the only information a rail carrier should be required to
provide is the mandatory data subset of the export manifest
transportation data. The commenter further suggests that the rule
should be revised to only permit enforcement on the rail carrier for
misstatements regarding the mandatory data subset of the export
manifest transportation data. The commenter objected that the proposal
places the onus on the rail carrier to transmit all data elements.
Response: CBP agrees that statutory principles guide this
rulemaking, including the authority to promulgate regulations providing
for the mandatory transmission of electronic cargo information,
pursuant to section 343(a) of the Trade Act. Furthermore, this rule
encourages the parties with the knowledge to supply the data. While all
eligible parties are encouraged to transmit data, the ultimate
obligation must rest with at least one party. Furthermore, there must
be a responsible party to reach should questions about the data arise
and/or violations involving false or inadequate transmission of data
occur. Without a clear identification of the transmitter of the data
whose bond is liable, CBP would never be able to identify the party
responsible for any data transmission deficiencies. As with other data
transmission rules, this regulation allows any party with the necessary
information to transmit it, but if no other party comes forward and
elects to transmit the data, the ultimate responsibility must fall on
the carrier as the party transporting the shipment out of the United
States. If the carrier does not provide the necessary information, the
carrier has the ability to remove the cargo as the conveyance will not
be authorized to leave the United States.
[[Page 55185]]
10. DNL/Holds
Comment: One commenter stated that the rule would have unintended
consequences to the fluidity of the rail network and supply chain,
citing the following concerns: if there is a referral made under
proposed 19 CFR 123.93(g), then the car, unit, or empty container may
not be exported; if a DNL/Hold instruction is made, then the rail
carrier may not even transport the car, unit, or empty container at all
under proposed 19 CFR 123.93(h); it appears that a referral or DNL/Hold
decision will be made by CBP after all data elements are collected from
the data transmitters, but CBP will not have all data elements until
two hours prior to departure, at which point a rail carrier under
normal circumstances would already have the train underway. This
commenter suggests that CBP eliminate the DNL/Hold instruction
provision of the rule.
Response: CBP disagrees that it should eliminate the DNL/Hold
instruction provision as the regulation does not state that CBP will
make decisions only after all elements are collected. In fact, one of
the purposes of the rule is to provide trade members with the ability
to provide data on a continuous basis as information becomes available,
which allows CBP to review the data on a continuous basis as it is
transmitted. Additionally, under the rule at 19 CFR 123.93(h), if a CBP
officer determines during the review that cargo or a rail car may
contain a potential threat to the train and its vicinity, then a DNL
instruction may be issued. Any such warning will assist in avoiding a
catastrophic event; so, in those instances, any transportation delay
and resultant inconvenience will be insignificant when compared to a
possible catastrophe averted.
Comment: One commenter stated that the rule should be modified to
allow rail carriers and CBP to designate inspection areas to reduce the
need for infrastructure, facilities, manpower, and equipment at the
actual border crossing or point of export.
Response: CBP will be flexible in working cooperatively with
carriers to accomplish necessary inspections with as minimal disruption
as possible, but inspectional decisions reside solely with the agency.
The transmission of EEM data in advance helps CBP review and allows CBP
to issue holds before cargo is loaded or before a train reaches the
U.S. port of export, thereby limiting the number of issues that CBP
must address at the U.S. port of export and reducing potential delays.
11. Timing
Comment: One commenter was concerned about the timing of CBP
referrals if the train is in route to the point of export where such an
inspection will occur. The commenter wrote that NPRM seems to
contemplate that inspections could just occur at the port of export,
which is not that simple for the rail carriers.
Response: CBP understands this concern and will endeavor to perform
all inspections with the least inconvenience to the trade. CBP
anticipates that the deadline requirements of this rule for
transmitting information allows CBP to conduct most, if not all risk
assessments, and identify potential cargo that may be inspected prior
to the train departing the port of export. If, however, a CBP officer
determines that an inspection needs to occur while in transit to avoid
a catastrophic threat, any transportation delay and inconvenience that
might be caused will be insignificant when compared to averting a
disaster.
12. Resources
Comment: One commenter stated CBP does not have the necessary
resources for a rule of this magnitude and expressed concern at how CBP
will inspect at points of export.
Response: CBP notes that resource management and inspection
techniques fall outside the scope of this regulation and do not need to
be considered. However, CBP will inspect cargo in a manner that causes
the least amount of disruption to the flow of commerce. CBP anticipates
that inspections will occur before the train departs the port of export
but acknowledges that there could be instances where an inspection
needs to occur between the port of export and crossing the border. CBP
does not anticipate that this will be a common event, especially when
data is provided within the deadlines of this rule.
13. Burden on Carriers
Comment: One commenter stated that the burden imposed on carriers
regarding the application of the EEI proposal to empty containers is
not justified by the risk because providing that data will be onerous
for rail carriers, especially when most rail equipment including
containers are not owned by the rail carrier, but instead by shippers,
equipment manufacturers, or lessors. The commenter expressed concern
that because such data is not provided by rail carriers to CBP for
empty containers, an entire system will need to be developed to do so.
Response: CBP maintains the right to make security and enforcement
decisions on the level of risk involved. Additionally, empty containers
are listed in the train consist currently being provided by
participants now, and do not require any additional data to be provided
in accordance with this rule. As identified above, this rule will be
effective 60 days from the date of publication, and a longer time
period will be provided to facilitate the transition before enforcement
begins.
14. Uniform Enforcement
Comment: One commenter suggested that CBP take steps to ensure that
it enforces the final rule uniformly across all points of export
because some rail carriers export cargo to northern, southern, and
maritime borders.
Response: CBP's goal is to make enforcement uniform in the rail
export environment and to have consistent enforcement procedures where
feasible. CBP notes that each port of export is unique and presents its
own challenges. CBP will endeavor to have uniform enforcement at every
port to the best of its ability.
15. Comments on Cost Benefit Analysis
Comment: A few commenters expressed concern about the requirement
for house-level data. They recognized CBP's need for house-level data
and stated that implementing this change for NVOCCs will necessitate
``significant investments'' in programming, process adjustments,
training, and associated costs and will require time to effectuate.
These commenters encouraged CBP to address these concerns in the
submission of the final rule to ensure effective and practical
implementation that aligns with industry operations.
Response: CBP acknowledges that the modernization of the export
manifest process, may result in trade members adjusting their business
practices in order to comply with this regulation. However, CBP
believes this final rule provides the best option to transition to
electronic environments and implement the Trade Act authority in a way
that also improves CBP's enforcement efforts on cargo security and
smuggling prevention. CBP notes that the data elements being requested
exist before the deadlines established for the data transmission. Trade
members may need to adjust their current processes in order to meet the
EEM data requirements. CBP agrees with the concern raised by these
commenters that there could be significant investments required for
NVOCCs and other non-rail carrier trade members that elect to
participate and
[[Page 55186]]
directly transmit EEM data to CBP. However, CBP notes that for these
trade members direct participation is voluntary and therefore they will
only directly participate if it makes business sense for them to do so.
In the NPRM, CBP specifically requested comments from trade members
on these potential costs to adjust business practices; however, no
specific monetized estimates were provided. These commenters suggest
there would be ``significant investments,'' but this statement lacks
the specificity needed for CBP to monetize such investments in the
economic analysis for this rule. However, CBP acknowledges that the
investments for these parties if they choose to participate directly as
rail EEM transmitters could be significant, and they would likely also
incur some cost savings as well. CBP's economic analysis for the NPRM
included a discussion of these costs and CBP has added to that
discussion based on the information received in this public comment.
Comment: One commenter stated that the cost-benefit analysis
provided was flawed and failed to account for significant costs that
would be imposed by this rule. The commenter asserted that the rail
network is not designed for disconnecting rail cars for inspection
outside of the port of export/rail yard. The commenter suggested that
implementing the necessary infrastructure and equipment at all points
of export would cost millions of dollars in land acquisition and rail
construction, and significant delays in rail transportation at certain
points of export. The commenter also suggested that trade members would
be required to develop new programming to provide the new data elements
to CBP. Furthermore, the commenter stated that because this NPRM
introduced a CBP system-generated inspection not currently done at
export, it would result in increased delays of rail traffic and not
time benefits to the rail carriers.
Response: CBP disagrees that the rule will necessitate the
disconnection of rail cars for inspection outside of the port of
export/rail yard. CBP believes this rule provides sufficient time for
the data to be provided so CBP can complete a proper risk assessment
such that all cargo inspections will be conducted before the train
departs from the final port of export. CBP retains the authority to
conduct inspections, when necessary, even if it must be conducted
between the train's departure from the final port of export and
crossing the international border. In such an instance, this will
result in a delay in the train's departure from the United States and
will result in a cost to the rail carrier. CBP notes that these
scenarios would be in the very rare cases where a significant imminent
threat is identified after the train is given clearance to depart the
United States from the final port of export and has not yet crossed the
international border, and CBP will request the train be routed to where
an inspection can be conducted. CBP does not quantify these costs
because they are very unlikely to occur. CBP's goal is to conduct such
inspections with the least amount of disruption to the trade whenever
possible.
Additionally, CBP notes that the rule's requirements for data
transmissions prior to departing the U.S. port of export will further
limit the number of inspections that will need take place between the
U.S. port of export and crossing the international border. CBP plans to
move forward with the existing infrastructure at border crossings and
does not expect rail carriers or CBP to invest in these significant
costs as stated by this commenter.
CBP acknowledges that rail carriers will incur systems costs, and
CBP has accounted for the systems costs to rail carriers in the
analysis for this rule. Regarding the system costs to other trade
members, CBP notes that their participation in providing EEM data
directly to CBP is voluntary and as such CBP assumes that they will
only do so if it were beneficial to their business. CBP requested
feedback on those potential costs but did not receive specific feedback
during public comments to provide an estimated amount to the average
non-rail carrier participant. The feedback received from the rail EEM
Test participants suggested that providing the EEM data to CBP did not
result in any increased delays of rail traffic.
Comment: One commenter stated that the rule is based on a Test
pilot program that was limited in its application and does not account
for concerns raised in the comment provided. Because the pilot was
limited in application and scope, the commenter stated that the Test
pilot program is not a good representation of costs to trade members
when this rule is finalized. The commenter stated that not all Class I
carriers were involved in the Test and those that were, did not have
every possible point of export included in the Test. The commenter
stated that no points of export at the southern border were included in
the Test because these are more difficult points of export. Lastly, the
commenter stated that CBP wrongfully overestimated the high compliance
rate for rail carriers transmitting data 24 hours before departure and
noted that one participant had to redesign its operations to account
for an inspection at the border crossing rather than the yard.
Response: CBP has been conducting the Electronic Export Manifest
Test for Rail Cargo since 2015. The rail EEM Test data received was
limited by what Test participants were willing to provide. CBP did not
limit Test participants to provide rail EEM Test data only at specific
ports of export. Because participation in the Test was voluntary, the
participants, not CBP, determined what data to provide to CBP. CBP
based its cost estimates on the information that was available from the
Test and based on feedback from the rail EEM Test participants. CBP
provided its best estimates on the costs associated with this rule
based on the information available to CBP and the participation in the
pilot. CBP acknowledges there may be a range of estimates because not
all experiences may be the same. However, CBP will endeavor to perform
all inspections with the least inconvenience to the trade. CBP
anticipates that the deadline requirements of this rule will allow CBP
to conduct most, if not all, risk assessments and identify potential
cargo that may need to be inspected prior to the train's departure from
the United States.
CBP acknowledges this comment and concern that Test data was not
provided at all port of export locations and that there may be
differences between different ports of export and that there may be
certain industry practices that could create unique challenges
resulting in costs. However, CBP has taken this comment into
consideration and incorporated these concerns into the analysis for
this rule. Since this comment did not provide quantitative estimates
for these costs, CBP can only provide a qualitative discussion of these
potential costs to trade members that did not participate in the rail
EEM Test.
Comment: One commenter disagreed with CBP's assumption that there
would be negligible additional cost to rail EEM participants to comply
with the bond requirements. Specifically, the commenter's concern is
for rail carriers that would be responsible for transmitting all data
elements if no other party elects to participate, and then the rail
carriers would be liable for the liquidated damages based on data that
the rail carrier was provided and about which the carrier lacked direct
knowledge.
Response: CBP notes that rail carriers may be required to be the
EEM
[[Page 55187]]
transmitter for all data if no other eligible party elects to directly
transmit the data. However, if the parties with the most direct
knowledge of the information decide not to transmit the EEM data
directly to CBP, they must provide that information to rail carriers in
a timely manner, or the cargo cannot be exported. Additionally, the
regulations provide that, where a transmitting party (including a rail
carrier that transmits EEM data to CBP) is not reasonably able to
verify information that it receives from another party in accordance
with ordinary commercial practices, it may electronically transmit the
unverified information to CBP based on what the transmitting party
reasonably believes to be true.
CBP also notes that all rail carriers that engage in carrying goods
for export out of the United States are also engaged in carrying goods
for import into the United States and therefore already have a
requirement to secure and obtain a bond, so CBP expects adding this
provision will not add a significant cost to these rail carriers.
VII. Regulatory Analyses
A. Executive Orders 12866, 13563, and 14192
Executive Orders 12866 (Regulatory Planning and Review) and 13563
(Improving Regulation and Regulatory Review) 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. Executive Order 13563 emphasizes the importance of
quantifying both costs and benefits, of reducing costs, of harmonizing
rules, and of promoting flexibility. Executive Order 14192 (Unleashing
Prosperity Through Deregulation) directs agencies to significantly
reduce the private expenditures required to comply with Federal
regulations and provides that ``any new incremental costs associated
with new regulations shall, to the extent permitted by law, be offset
by the elimination of existing costs associated with at least 10 prior
regulations.''
The Office of Management and Budget (OMB) has designated this rule
a ``significant regulatory action'' under section 3(f) of Executive
Order 12866, although not economically significant under section
3(f)(1). Accordingly, the rule has been reviewed by the Office of
Management and Budget.
This final rule is considered an Executive Order 14192 deregulatory
action. CBP's quantified estimates demonstrate this rule generates
$9.01 million in annualized net cost savings using a seven percent
discount rate, discounted relative to year 2024, over a perpetual time
horizon. However, the costs imposed by the rule are not fully
quantified.
In summary, CBP expects that this final rule will result in a
present value total combined net cost savings of $37.5 million using a
three percent discount rate and $22.7 million using a seven percent
discount rate; to CBP, outbound rail carriers and other trade members
during the period of analysis (2016 to 2030). Meanwhile, annualized net
cost savings are estimated to range between $3.1 million and $2.5
million using a three and seven percent discount rate respectively. CBP
anticipates that this final rule will also provide added benefits from
enhanced cargo security measures by improving compliance and the
enforcement of U.S. export laws and regulations on U.S. rail exports,
while also improving the facilitation of the export process. The
following is the economic analysis of the potential effects from this
final rule. Based on feedback from public comments received from the
rail EEM NPRM, CBP made a few changes between the analysis for the NPRM
and for this final rule. CBP revised a data element ``AES Exemption
Statement, as applicable'' to ``AES (AES) Internal Transaction Number
(``ITN'') or FTR exemption/exclusion code'', and this data element will
be conditional in the initial filing in this final rule. Additionally,
CBP removed the requirement to have trade members provide telephone and
email address that is monitored 24 hours/7 days a week to address any
holds issued by CBP. CBP does not expect these changes to result in any
additional quantifiable costs or cost savings from this final rule.
Purpose and Background
CBP's mission includes ensuring cargo security and preventing
smuggling, while enforcing U.S. trade laws and regulations. CBP needs
to obtain timely and sufficient data prior to cargo arriving or
departing the United States, via any mode of commercial transportation,
in order to review and conduct risk assessment to identify high-risk
shipments and inspect cargo effectively. According to Section 343(a) of
the Trade Act of 2002, as amended (Trade Act) (19 U.S.C. 1415), CBP is
authorized to establish regulations that provide for the mandatory
electronic transmission of data by way of a CBP-approved electronic
data interchange before cargo arrives or departs the United States in
all environments (sea, air, rail, and truck). Transmitting export
manifest data electronically, instead of on paper or via email, allows
CBP to use its Automated Targeting System (ATS) to screen all data
transmitted. This allows CBP to make better examination decisions while
also reducing the time required to make such decisions. Trade members
also experience efficiencies through quicker CBP examination decisions
and improved communication between CBP and trade members. The
requirement to transmit manifest data through an electronic data
interchange (ACE), which is the same system through which data is
incorporated from AES, is also important to help facilitate a more
efficient trade process for all federal agencies and trade members
involved. Transmitting electronic manifest data (specifically pre-
arrival or pre-departure) significantly increases CBP's ability to
conduct risk assessment and identify high-risk cargo to ensure cargo
security and to prevent smuggling. Additionally, the electronic
environment will improve and expedite communications between CBP and
trade members in resolving examinations where additional or corrected
information of the transmission is required.
Baseline
In the rail environment, CBP currently requires the advance
electronic submission of data for all cargo being brought into the
United States, but CBP does not require the pre-departure electronic
transmission of data for all exported cargo. CBP requires some
electronically transmitted cargo data prior to departing the United
States by rail but this data is significantly limited in scope. Current
regulations \8\ require the U.S. Principal Party in Interest (USPPI),
the USPPI's agent, or the authorized filing agent of the Foreign
Principal Party in Interest (FPPI) to transmit Electronic Export
Information (EEI) to CBP through the Automated Commercial Environment
(ACE), no later than two hours prior to the arrival of the train at the
border. Although this pre-departure data is helpful, the information
provided by EEI falls short of what CBP requires for proper
enforcement.
---------------------------------------------------------------------------
\8\ See 19 CFR 192.14.
---------------------------------------------------------------------------
Additionally, the required transmission of EEI is subject to
certain exemptions, as established by the Bureau of the Census
regulations,\9\ which generally only require EEI transmission on
shipments greater than $2,500 and do not require the transmission of
EEI for shipments destined for Canada, unless the
[[Page 55188]]
shipment contains certain controlled items or is being transshipped to
another destination.\10\ Therefore, numerous low dollar value shipments
and/or Canadian-bound shipments of merchandise departing the United
States by rail do not have EEI transmitted for CBP to review. The lack
of detailed electronic manifest data for some shipments and the
unavailability of electronic cargo data on lower value merchandise
shipments impedes CBP's enforcement efforts on rail exports.
---------------------------------------------------------------------------
\9\ See 15 CFR Part 30.
\10\ See 15 CFR 30.36.
---------------------------------------------------------------------------
Although CBP receives limited pre-departure electronic data for
rail exports, CBP usually receives additional pre-departure data from
rail carriers or their agents. This information, however, is submitted
via attachments to an email, which is not the most efficient or
effective method to obtain such data and perform risk assessment.\11\
During the export cargo process, the rail carrier may not load cargo
without first receiving from the USPPI or its authorized agent either
the related EEI filing citation, covering all cargo for which the EEI
is required, or exemption legends, covering cargo for which EEI need
not be filed. While the rail carrier is not required to submit a rail
cargo export manifest to CBP, the outbound rail carrier must annotate
the carrier's outward manifest, waybill, or other export documentation
with the applicable Automated Export System (AES) proof of filing, post
departure, downtime, exclusion, or exemption citations, conforming to
the approved data formats found in the Bureau of the Census Foreign
Trade Regulations.\12\
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\11\ This information is submitted by rail carriers for trains
transporting cargo out of the United States and is provided
regardless of whether an EEI submission is required.
\12\ See 15 CFR part 30.
---------------------------------------------------------------------------
In the baseline rail carriers or their agents submit finalized
train consists to CBP in a format of the rail carrier's choosing before
a train is granted permission to depart from the U.S. port of
export.13 14 Rail carriers or their agents can provide this
data via email prior to a train's arrival at the U.S. port of export
(pre-departure) or present this data to a CBP officer at departure when
the train arrives at the U.S. port of export (at departure). The
submission of such data pre-departure via email is not mandatory, nor
is there a required time frame for submitting such information.
However, rail carriers have an incentive to provide this information
pre-departure so that CBP has time to review the information before the
train reaches the U.S. port of export, expediting the export process.
Because of this incentive, rail carriers usually send this information
to CBP at least two hours prior to a train's arrival at the United
States border.\15\ If rail carriers or agents choose not to provide
this data pre-departure, they must present the finalized train consists
to CBP upon arrival at the U.S. port of export at which point CBP
officers must complete the review of the train consists while the train
is at the U.S. port of export, resulting in a potential delay in the
train's departure.
---------------------------------------------------------------------------
\13\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
February 25, 2022.
\14\ A train consist is documentation that generally refers to
the contents of a train including the position of the locomotives
and cars, as well as both non-hazardous and hazardous freight within
those cars.
\15\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on June
21, 2022.
---------------------------------------------------------------------------
Once this information is received by CBP (either via email or in
person at the port of export), CBP officers will then conduct a review
of the export information, which includes reviewing the finalized train
consist (paper version or emailed) manually and addressing any issues.
CBP officers must then also compare this data with any EEI information
transmitted electronically for that train along with any other
documents. To ensure proper cargo security, during this review CBP
officers must also conduct their targeting and risk assessment measures
and then determine if any cargo needs to be examined before a train
departs the United States. In the baseline scenario, CBP is not able to
automatically use ATS for risk assessment on the export information
contained on the train consists provided by rail carriers to CBP.\16\
Although CBP officers can manually query ATS with information provided
on the finalized train consists, CBP notes this is a cumbersome and
time-consuming process and is not a frequent occurrence. If during
CBP's review of this information, prior to the train's arrival at the
U.S. port of export, CBP officers find any discrepancies or missing
data, CBP communicates via email to the rail carrier that submitted the
data, requesting updates or corrections to the data provided. The CBP
review process, including communications between CBP and rail carriers
about discrepancies discovered while reviewing train consist
information, can be unnecessarily cumbersome and time consuming because
this data is provided via email attachments and the formats can be
inconsistent across rail carriers. If CBP is not provided the pre-
departure data or is not provided the data in a time frame that allows
for CBP to properly review, request, and receive updates from rail
carriers, and conduct proper risk assessment or examine high-risk cargo
or shipment manually, then a CBP officer must resolve these issues at
the U.S. port of export. This usually results in a delay to the train's
departure.
---------------------------------------------------------------------------
\16\ In the baseline scenario CBP is not able use ATS for risk
assessment on export data submitted on paper forms (or via email)
and paper forms cannot be automatically uploaded or submitted to ATS
for risk assessment. A primary benefit of this rule is allowing CBP
to automatically use ATS for risk assessment on all rail EEM data
provided.
---------------------------------------------------------------------------
CBP does not track how often rail carriers provide this pre-
departure data nor to what extent CBP officers are able to conduct some
or all of their manual review of the data prior to the train's arrival
to the U.S. port of export. Sometimes CBP identifies a high-risk cargo
or shipment during manual review at the U.S. port of export or while
reviewing pre-departure data but does not have time to adjudicate the
shipment prior to a train's arrival at the U.S. port of export. In this
situation, the CBP officer holds the train until one or more freight
car(s) can be removed from the already constructed train for
examination, which can cause delays and can be costly to rail
carriers.\17\
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\17\ Unfortunately, CBP does not track how often manual
examinations occur on average each year as these examinations are
not entered into a system of record.
---------------------------------------------------------------------------
This final rule will establish a requirement for the electronic
transmission of export manifest data pre-departure from the United
States for all cargo in the rail environment. CBP defines the process
described above as the regulatory baseline and the analysis of this
final rule attempts to measure any incremental costs, cost savings, or
benefits compared to the baseline scenario.
The ACE Export Manifest for Rail Cargo Test
CBP has been working toward developing a new process to require the
transmission of electronic export manifest (EEM) data for all cargo
departing the United States by rail to enhance CBP's efforts to ensure
cargo security while also preventing smuggling and implement the Trade
Act authority. CBP expects that the transmission of pre-departure EEM
data would help CBP obtain all the necessary data to successfully
review and conduct risk assessment measures before trains reach the
U.S. port of export, thereby limiting the number of issues that CBP
must address at the U.S. port of export and reducing potential delays.
Rail carriers have also acknowledged that the
[[Page 55189]]
baseline process of sending forms of rail export data by email is
unnecessarily costly, time burdensome, and inconsistent with the
process for providing data on cargo entering the United States.\18\ As
such, rail carriers have generally been supportive of CBP's efforts to
provide a more efficient process by allowing for the transmission of
rail EEM data.
---------------------------------------------------------------------------
\18\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
---------------------------------------------------------------------------
In September of 2015, CBP introduced a two-year pilot test program,
referred to in this analysis as the ACE Export Manifest for Rail Cargo
Test (the Test), to determine the feasibility for rail carriers or
their agents to provide pre-departure EEM data for rail exports to CBP
via ACE within a specified time before cargo departs the United States.
To test the functionality of this new process, CBP initially limited
participation in the Test to nine rail carriers. During this initial
phase of the Test, CBP worked with rail carriers who agreed to
participate and transmit EEM data to CBP via ACE in addition to
providing paper forms. The participants were large rail companies,
similar in most respects to those that did not participate. As such,
CBP believes their experience with the Test is informative for
analyzing the effects of the rule. CBP requested comment during the
NPRM on any meaningful differences between the participants and the
non-participants that would affect the analysis. CBP did receive a
public comment stating that the rail EEM Test experienced limited
participation, that not all Class I carriers were involved in the Test,
and not every point of export was included in the Test. The commenter
stated that because of these factors, the Test does not provide a good
representation of the costs. CBP acknowledges that participation in the
Test was limited but CBP notes that the Test was expanded and extended
in 2017 and has since been available to all trade members. CBP
acknowledges that effects from this final rule will be different
depending on the trade member and the port of export, but CBP believes
that the quantitative data provided in the analysis for this final rule
which is based on feedback from the public through public comments and
rail EEM Test participants is CBP's best quantitative estimate. Any
effects CBP was unable to quantify CBP discusses qualitatively. CBP
included input received through the public comments to improve its
analysis, though some commentors did not provide substantive or
quantitative information that could be used in the analysis. In
addition, CBP has made changes to the rule in response to public
comments that highlighted costs that would be more severe for certain
trade members, including smaller trade members.
CBP requested that rail EEM Test participants continue to provide
data in paper forms as they did before the Test so that CBP could
capture any inconsistencies or issues with the electronic transmission
of rail export manifest data to CBP. In the Test, CBP requested that
participants provide rail EEM data to CBP at least two hours prior to
loading the cargo onto the train, or in the case of empty rail cars
upon assembly of the train.\19\ Because ACE would conduct a majority of
the risk assessment and review of electronically transmitted data, CBP
anticipated that this two-hour window would provide enough time for CBP
to review pre-departure EEM data prior to the cargo being loaded onto
trains and before the trains have been assembled. The two-hour time
frame also provided CBP the opportunity to notify rail carriers or
agents to revise and correct export manifest data where necessary
before the cargo is loaded. This increased the chance that CBP could
conduct cargo inspections before cargo is loaded and trains are
assembled, avoiding costly time burdens if issues need to be addressed
after the train has been constructed. The required deadline for EEM
data also provided CBP an opportunity to compare any EEI transmitted by
the USPPI with the export manifest data to properly conduct safety and
security screening for cargo departing the United States in the rail
environment.
---------------------------------------------------------------------------
\19\ CBP notes that although the Test requested export manifest
data to be provided within certain deadlines, participants were not
required to provide data within these time frames. Participants were
given flexibility to provide the data to CBP electronically and were
not penalized if export manifest data was not transmitted within the
time frames of the Test. However, CBP experienced high levels of
compliance with EEM data transmissions with 94 percent of all data
transmissions submitted greater than 24 hours prior to the departure
time.
---------------------------------------------------------------------------
One major improvement of the Test was that rail carriers can
provide and revise export manifest data electronically on a flow basis
when the export data becomes available during the export process.
Typically, rail carriers provide export manifest data in documents
known as bills of lading (bills), which act as a receipt and contract
of transporting cargo and goods. These bills can come from a number of
sources depending on which party is privy to the information and the
timing of when the information is provided. A house bill contains cargo
details and is issued directly by a party such as a Non-Vessel
Operating Common Carrier (NVOCC) or freight forwarder. This bill acts
as the receipt of exported goods and provides export manifest data at
its lowest level. Carriers issue a master bill which includes all other
export manifest information such as transportation details for the
transporting train covering any number of house bills that are included
on that train. Additionally, in the case where a NVOCC or freight
forwarder is not involved in the shipment transaction and the carrier
has the specific cargo data available, the carrier can issue a ``simple
bill,'' which is similar to a house bill and contains cargo details at
the lowest bill level of export manifest data. In the rail environment,
house bills and master bills are not typically issued because rail
carriers usually issue simple bills for all cargo and then submit
finalized train consists to CBP. These consists include the simple
bills associated with all the cargo on the train and any other
transportation data for the train prior to departure from the U.S. port
of export. The Test allowed participants to transmit these simple bills
on a flow basis when the information becomes available. This differs
from the baseline scenario where rail carriers typically waited for
simple bills to be finalized before sending the export manifest data in
the finalized train consist in paper format to CBP for review. The
transmission of EEM data, via ACE, allows for the integrated system to
conduct a large portion of the review process using data validations,
checks, and risk assessment measures prior to the rail carriers loading
cargo onto freight cars or constructing the train. Additionally, upon
transmission of the pre-departure EEM data, CBP can review data on a
flow basis while rail carriers provide updated data throughout the
export process.
The integrated system will generate two types of holds when rail
carriers transmit bills: 2H Documentation holds, which notifies the
rail carriers or their agents in the integrated system of outstanding
issues with the data provided, and 1H Enforcement holds, which result
from CBP's risk assessment. In the instance of a 2H Documentation hold,
the rail carrier or agent must add or revise the missing or incorrect
reference data in order to release the hold on the cargo prior to
departure from the United States. The 2H Documentation holds
automatically generated by ACE do not require any action or response
from CBP or CBP officers and only affect rail carriers or
[[Page 55190]]
their agents. The integrated system assists CBP in its risk assessment
efforts and the identification of high-risk cargo. If during the
integrated systems risk assessment, a potential high-risk cargo is
identified, then a 1H Enforcement hold is generated which requires a
CBP officer to conduct a review of the export manifest data
transmitted.\20\ The rail carriers are notified of these holds through
the integrated system which lets them know if a mandatory examination
of the cargo and or freight car is required or if CBP needs to conduct
further review of the data transmitted. These holds can be issued and
addressed even after rail carriers load the cargo. If a 1H Enforcement
hold is issued to a rail carrier after loading the cargo and CBP
requests to inspect the cargo, the rail carrier must provide CBP with a
location where CBP can conduct a proper examination. In addition to
holds, if a CBP officer determines during review that cargo or a rail
car may contain a potential threat to the train and its vicinity, a Do-
Not-Load (DNL) instruction is issued, which prohibits the rail carrier
from transporting that cargo or rail car. The rail carrier should not
transport any cargo or rail car with a DNL. The transmission of EEM
data in advance would help CBP review, and issue holds before cargo is
loaded or before a train reaches the U.S. port of export. This
transmission facilitates a more efficient export process by reducing
the likelihood of a freight car or cargo being removed from a
constructed train and the resulting delays when departing the U.S. port
of export.
---------------------------------------------------------------------------
\20\ CBP officers can also issue 1H Enforcement holds during
manual review of electronic export manifest data transmitted.
---------------------------------------------------------------------------
Rail carriers participating in the Test provided a number of
mandatory and conditional data elements electronically to CBP via ACE.
CBP determined that the selected data elements (listed below) would
provide the information necessary to conduct proper cargo security
enforcement. Rail carriers were already providing these data elements
by the time of departure from the U.S. port of export to CBP prior to
the Test but in paper form within the finalized train consists. The
Test also required participating rail carriers to submit these data
elements at the lowest bill level possible. The necessary data elements
CBP selected during this initial phase of the Test, including empty
rail cars, consisted of the following:
(1) Mode of Transportation (containerized rail cargo or non-
containerized rail cargo)
(2) Port of Departure from the United States
(3) Date of Departure \21\
---------------------------------------------------------------------------
\21\ CBP defines this data element as the date the train departs
the United States; the date the train crosses the international
border.
---------------------------------------------------------------------------
(4) Manifest Number
(5) Train Number
(6) Rail Car Order
(7) Car Locator Message
(8) Hazmat Indicator (Yes/No)
(9) 6-character Hazmat Code (conditional) (If the hazmat indicator is
yes, then UN (for United Nations Number) or NA (North American Number)
and the corresponding 4-digit identification number assigned to the
hazardous material must be provided.)
(10) Marks and Numbers
(11) SCAC (Standard Carrier Alpha Code) for exporting carrier
(12) Shipper name and address (For empty rail cars, the shipper may be
the railroad from whom the rail carrier received the empty rail car to
transport.)
(13) Consignee name and address (For empty rail cars, the consignee may
be the railroad to whom the rail carrier is transporting the empty rail
car.)
(14) Place where the rail carrier takes possession of the cargo
shipment or empty rail car
(15) Port of Unlading
(16) Country of Ultimate Destination
(17) Equipment Type Code
(18) Container Number(s) (for containerized shipments) or Rail Car
Number(s) (for all other shipments)
(19) Empty Indicator (Yes/No)
Additionally, if the rail carrier identified that the rail car is
not empty (empty indicator is no), then CBP also required information
for the following data elements for non-empty rail cars, as applicable:
(20) Bill of Lading Numbers (Master and House)
(21) Bill of Lading Type (Master, House, Simple or Sub)
(22) Number of house bills of lading
(23) Notify Party name and address (conditional)
(24) AES Internal Transaction Number or AES Exemption Statement (per
shipment)
(25) Cargo Description
(26) Weight of Cargo (may be expressed in either pounds or kilograms)
(27) Quantity of Cargo and Unit of Measure
(28) Seal Number
(29) Split Shipment Indicator (Yes/No)
(30) Portion of split shipment (e.g., 1 of 10, 4 of 10, 5 of 10--Final,
etc.) (conditional)
(31) In-bond Number (conditional)
(32) Mexican Pedimento Number (only for shipments for export to Mexico)
(conditional)
After the initial two-year period, CBP determined that the initial
phase of the Test had been feasible and functional for participating
rail carriers to provide EEM data and therefore CBP extended the Test
in 2017. At that time, CBP expanded the Test and made it available to
all rail carriers and other trade members (beyond the initial nine rail
carrier limit) which met the eligibility criteria.\22\ After the first
two years of the Test, CBP received feedback from rail carriers from
the Commercial Customs Operations Advisory Committee (COAC), which
stressed that rail carriers may not have access to certain export
manifest data elements requested by CBP two hours prior to loading of
cargo. Therefore, CBP determined to change the filing condition for
nine of the pre-departure export manifest data elements for the Test
moving forward. As part of the Test extension, CBP separated EEM data
elements into three categories, mandatory, conditional, and optional
data, and requested this information for all cargo and empty rail cars,
at least two hours prior to loading of the cargo. CBP changed the
following pre-departure EEM data elements (which were originally
mandatory) to optional for the Test extension.
---------------------------------------------------------------------------
\22\ Limited to those parties able to electronically transmit
manifest data in the identified acceptable format. Prospective ACE
Export Manifest for Rail Cargo Test participants must have the
technical capability to electronically transmit data to CBP and
receive response message sets via Cargo-ANSI X12 (also known as
``Rail X12'') or Unified XML and must successfully complete
certification testing with their client representative. Once parties
have applied to participate, they must complete a test phase to
determine if the data transmission is in the required readable
format. Applicants will be notified once they have successfully
completed testing and are permitted to participate fully in the
Test. In selecting participants, CBP takes into consideration the
order in which the applications are received.
Mode of Transportation (containerized rail cargo or non-
containerized rail cargo) (Original Data Element #1)
Place where the carrier took possession (Original Data Element
#14)
Country of Ultimate Destination (Original Data Element #16)
Equipment Type Code (Original Data Element #17)
Number of house bills of lading (Original Data Element #22)
Split Shipment Indicator (Original Data Element #29)
Portion of split shipment (Original Data Element #30)
Mexican Pedimento Number (Original Data Element #32)
[[Page 55191]]
CBP also modified the Test by changing the following data element
from mandatory to conditional:
Marks and Numbers (Data Element #10)
CBP has continuously extended or renewed the Test to gauge the
functionality and feasibility of implementing the requirement of
providing EEM data to CBP prior to a train's departure. CBP believes
that the Test has been successful and, through this rulemaking, CBP
will now make the transmission of pre-departure EEM data mandatory for
all cargo departing the United States in the rail environment.
The ACE Export Manifest for Rail Cargo Program
This final rule will mandate the transmission of EEM data for all
cargo prior to departing the United States in the rail environment in
lieu of paper submissions, see Section V `Discussion of the Final Rule'
above for discussion on the regulatory requirements of this final rule.
CBP anticipates that requiring the transmission of pre-departure EEM
data will significantly improve CBP's ability to conduct proper cargo
security, prevent smuggling, and aid in facilitating a more effective
and efficient trade process. Under this final rule, the parties most
likely to have the correct data on rail export cargo will be able to
provide it to CBP through ACE. The experience and knowledge CBP gained
during the Test influenced CBP to change some of the requirements for
providing EEM data in this final rule.
CBP evaluated the time frames for electronic manifest data
transmission during the Test, the most important data elements needed
for risk assessment and screening cargo, and the unavailability to rail
carriers of certain data elements at given time frames and decided to
group the rail EEM data elements based on the deadlines for
transmission of data and on which party likely has the correct
information to provide the export manifest data. This final rule will
allow rail carriers, carriers' agents, NVOCCs, freight forwarders,
customhouse brokers (CHB), or anyone with direct knowledge of the
export manifest data to provide specific pre-departure export manifest
data to CBP, using CBP's ACE as a data transmission portal. This final
rule mandates that a party transmitting any specific EEM data must have
a bond on file with CBP that secures the obligation to transmit EEM in
the time and manner required by regulation. Additionally, the party
that transmits any EEM data electronically to CBP is also the
responsible party for addressing any questions, issues, instructions,
or holds resulting from CBP's review of that specific data.\23\ In the
NPRM, CBP suggested requiring the party transmitting the EEM data to
provide a telephone number and email address that will be monitored 24
hours per day and seven days a week. However, CBP received a number of
public comments suggested that the 24 hours a day, seven days a week
requirement would place an unfair burden, specifically on smaller trade
members and therefore CBP removed the requirement of providing a 24-
hour monitored telephone number and email address in this final rule.
CBP anticipates that ACE will electronically and automatically notify
whoever has transmitted rail EEM data to CBP.
---------------------------------------------------------------------------
\23\ CBP notes that the rail carrier will always be noticed of a
DNL or Hold even in the instance that another party was the EEM data
transmitter.
---------------------------------------------------------------------------
To improve CBP's risk assessment and screening efforts using pre-
departure EEM data, this final rule will require an initial filing of
seven mandatory data elements, which must be transmitted to CBP by any
eligible party at least 24 hours prior to the departure from the U.S.
port of export, and one conditional data element that must be
transmitted as soon as applicable.\24\ The rail carrier is responsible
for providing the initial filing data elements to CBP if no other
eligible party elects to transmit the data. Eligible parties should
transmit all other pre-departure EEM data elements to CBP no later than
two hours prior to departure from the U.S. port of export, except for
data on empty containers which will be required upon assembly of the
train. From CBP's experience during the Test, CBP does not anticipate
that changing the time frames for data transmission in this final rule
will cause any data transmission issues for parties transmitting the
information.\25\ Depending on the party providing the EEM data, the
required export data may be available at different points in time
during the export rail transaction process. Some rail carriers will
have the export manifest data available days in advance prior to
departure and therefore will have all the necessary information to
transmit the initial filing data to CBP and all other export manifest
data well in advance of the 24-hour and 2-hour prior to departure
deadlines.\26\ CBP anticipates that all rail carriers will likely
obtain the necessary export data elements to provide the required
transportation and cargo EEM data within the two-hour prior to
departure deadline.\27\ CBP received a public comment stating that
CBP's assumption of high compliance from rail carrier when requesting
data 24 hours in advance is overestimated because the Test was flawed
based on limited participation. The commenter suggests that CBP's
assumptions are based on the rail EEM Test which did not receive rail
EEM data at some of the more difficult ports of export, and it would be
difficult in some situations to provide rail EEM data 24 hours in
advance, and the commenter suggests all data should be transmitted 2
hours in advance. CBP agrees with the comment that every U.S. port of
export in the rail environment is unique and creates different
challenges, but CBP based its assumptions for data availability on
feedback from rail EEM Test participants that voluntarily provided rail
EEM Test data at ports of exports that they wished.\28\ Additionally,
in the NPRM, CBP acknowledged that rail carriers may need to make
changes stating that some rail carriers acquiring the necessary data
for the initial filing 24 hours prior to departure may require a change
in business practices and additional coordination with other trade
members or parties that have the required export manifest data. See 90
FR at 2886. As CBP wrote in the NPRM, CBP does not believe that in such
instances the export manifest data does not exist, rather, the other
trade members have not yet provided this information to the rail
carrier.\29\ CBP expects that in such instances, the costs to rail
carriers to obtain this information from other trade members a few
hours earlier will be minimal. Additionally, if other trade
[[Page 55192]]
members are reluctant to provide this information to rail carriers
within the 24-hour prior to departure deadlines, the other trade
members will be able to transmit this data to CBP directly as a
participant of the rail EEM.
---------------------------------------------------------------------------
\24\ Based on feedback CBP obtained from public comments
following the NPRM, CBP decided to change one of the initial filing
data elements from mandatory to conditional (all other data elements
are mandatory), that data element is expected to be provided if it
exists at the time of initial filing, if not then it will be
provided in the mandatory export cargo data.
\25\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
\26\ CBP obtained feedback and information from Trade members on
when in the export transaction process, the export manifest data is
typically available for them to submit to CBP. Information obtained
in February 2023.
\27\ CBP obtained feedback and information from Trade members on
when in the export transaction process, the export manifest data is
typically available for them to submit to CBP. Information obtained
in February 2023.
\28\ After the rail EEM Test was extended in 2017, CBP did not
put any limits on the trade members that could participate or which
ports of export the participants should provide rail EEM data for
departing trains. CBP only received rail EEM test data based on what
voluntary participants were willing to provide.
\29\ Information provided during discussion with some Trade
members in regard to the timeline for when export manifest data is
available to provide to CBP and challenges to providing pre-
departure data well in advance. Data obtained in February 2023.
---------------------------------------------------------------------------
CBP notes that during the Test, participants were already providing
most of the data required in the initial filing well in advance of
departure and more than 24 hours prior to departure.\30\ CBP expects
that rail carriers and other trade members will have access to most
export manifest data early in the planning stages of an export rail
cargo transaction and will be able to comply with these time frames.
Additionally, participating parties will be able to transmit EEM data
to CBP on a flow basis whenever it becomes available to help facilitate
CBP's review of the export data and the overall export process. CBP
anticipates that these time frames will provide CBP with adequate time
to perform proper risk assessment and identify any cargo that CBP needs
to examine, early enough in the supply chain to enhance security while
minimizing disruption to the flow of goods. Upon transmission of the
initial filing, CBP will validate or notify the party responsible of
any holds or DNLs. The party that transmits the data is responsible for
providing answers and updates on the data to CBP but the ultimate
responsibility to load, hold, or not load cargo falls on the rail
carrier.\31\
---------------------------------------------------------------------------
\30\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on August 2, 2022.
\31\ CBP notes that the rail carrier will always be notified of
any Hold or DNL even in the case that they were not the EEM data
transmitter.
---------------------------------------------------------------------------
Of the mandatory data elements CBP selected for the initial filing,
six were part of the mandatory data elements in the Test; however, CBP
revised the descriptions of these elements in this final rule to
provide additional clarity on the data required. Based on feedback CBP
obtained from public comments during the NPRM, CBP revised some data
elements, including the data element ``AES Exemption Statement, as
applicable'' to ``AES (AES) Internal Transaction Number (``ITN'') or
FTR exemption/exclusion code'', and this data element will be
conditional in the initial filing in this final rule. Additionally, to
provide additional clarity, CBP removed identification numbers as
acceptable data as proposed during the NPRM for the shipper's complete
name and address and the consignee's complete name and address and
created a new data element `Employer Identification Number (EIN) or
Importer Record Number or CBP assigned number' as a mandatory data
element for the initial filing for this final rule. The mandatory
initial filing data elements required in this final rule include the
following, listed as well are the data elements' corresponding
descriptions during the Test:
(1) Mandatory Data
(i) Bill of lading number,
(ii) The numbers and quantities of the cargo laden aboard the train
as contained in the carrier's bill of lading, either master or house,
as applicable (this means the quantity of the lowest external packaging
unit; the numbers or quantities of containers and pallets do not
constitute acceptable information; for example, a container holding 10
pallets with 200 cartons should be described as 200 cartons [Test data
element of Quantity of Cargo and Unit of Measure],
(iii) Total weight of cargo expressed in pounds or kilograms [Test
data element of Weight of Cargo (may be expressed in either pounds or
kilograms)],
(iv) A precise cargo description (or the Harmonized Tariff Schedule
(HTSUS) number(s) to the 6-digit level under which the cargo is
classified if that information is received from the shipper and weight
of the cargo); or for a sealed container, the shipper's declared
description and weight of the cargo (generic descriptions, specifically
those such as ``FAK'' [``freight of all kinds''], ``general cargo'',
and ``STC'' [``said to contain''] are not acceptable) [Test data
element of Cargo Description],
(v) The shipper's complete name and address, from the bills of
lading (for each house bill in a consolidated shipment) [Test data
element of Shipper name and address],
(vi) The consignee's complete name and address, from the bill(s) of
lading (The consignee is the party to whom the cargo will be delivered
in a foreign country. However, in the case of cargo shipped ``to order
of [a named party],'' the ``to order'' party must be named as the
consignee; and if there is any other commercial party listed in the
bill of lading for delivery or contact purposes, the carrier must also
report this other commercial party's identity and contact information
including address in the ``Notify party'' field.) [Test data element of
Consignee name and address], and
(vii) Employer Identification Number (EIN) or Importer Record
Number or CBP assigned number.
Additionally, CBP is adding one conditional data element be
provided at the time of the initial filing, if applicable.
(2) Conditional Data
Automated Export System (AES) Internal Transaction Number (``ITN'')
or FTR exemption/exclusion code [Test data element AES Exemption
Statement (per shipment)].
In this final rule, CBP groups the remaining rail EEM data elements
based on CBP's understanding of which parties may have the best
knowledge of the export manifest data elements. CBP categorizes these
remaining data elements as export manifest transportation data, export
manifest cargo data, and empty container data. According to this final
rule, the rail carrier or its agent is responsible for transmitting to
CBP the EEM data on any empty container rail cars.\32\ This data must
be transmitted electronically no later than the time of assembly of the
train. For EEM transportation data, the rail carrier or its agent must
also transmit this data at least two hours prior to departure from the
U.S. port of export. The rail carrier or its agent is responsible for
providing the following EEM transportation data elements to CBP in this
final rule:
---------------------------------------------------------------------------
\32\ If applicable, empty container rail car data would be
included in the Train Consist data element of the mandatory data
elements for transportation data. Empty containers are listed in the
train consist and do not require any additional data to be provided
as per this rule.
---------------------------------------------------------------------------
Mandatory Elements
(1) Port of departure from the United States
(2) Date of departure \33\
---------------------------------------------------------------------------
\33\ CBP clarifies that this data element means the date the
train departs the United States; the date the train crosses the
international border.
---------------------------------------------------------------------------
(3) Estimated time of departure \34\
---------------------------------------------------------------------------
\34\ CBP clarifies that this data element is the estimated time
the train departs the United States; the time the train crosses the
international border.
---------------------------------------------------------------------------
(4) Carrier-assigned conveyance name, equipment number and trip number
(5) Train Consist, which includes: (A) manifest number, (B) train
number, (C) rail car order, and (D) empty containers (if applicable)
(6) The rail carrier identification SCAC code (the unique Standard
Carrier Alpha Code assigned for each carrier by the National Motor
Freight Traffic Association; see Sec. 4.7a(c)(2)(iii) of this chapter)
(7) Container or equipment numbers (for containerized shipments) or
Rail Car Numbers (for all other shipments)
(8) Employer Identification Number (EIN) or Importer Record Number or
CBP assigned number
Conditional Elements
(1) 6-character Hazmat Code. (If the Hazmat indicator is yes, then UN
[[Page 55193]]
(for United Nations Number) or NA (North American Number) and the
corresponding 4-digit identification number assigned to the hazardous
material must be provided)
(2) Marks and Numbers
(3) Seal number (only required if container was sealed.) \35\
---------------------------------------------------------------------------
\35\ The seal numbers for all seals affixed to containers and/or
rail cars to the extent that CBP's data system can accept this
information (for example, if a container has more than two seals,
and only two seal numbers can be accepted through the system per
container, electronic presentation of two of these seal numbers for
the container would be considered as constituting full compliance
with this data element).
---------------------------------------------------------------------------
Optional Elements
(1) Mode of transportation (containerized rail cargo or non-
containerized rail cargo)
(2) Equipment type code
(3) Place where the rail carrier takes possession of the cargo shipment
or empty rail car
CBP provides additional flexibility in this final rule by allowing
any eligible party with the most direct information to provide EEM
cargo data to CBP two hours prior to departure from the U.S. port of
export. However, the rail carrier or its agent may also elect to
transmit the mandatory EEM cargo data and in the case that no other
party elects to provide the required EEM cargo data, it is the rail
carrier's responsibility to provide this EEM cargo data to CBP.\36\ The
following data elements comprise the CBP-requested EEM cargo data for
rail EEM in this final rule. CBP notes that if the data was provided
during the initial filing it does not need to be transmitted again
unless there are updates or changes made to the data.
---------------------------------------------------------------------------
\36\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
---------------------------------------------------------------------------
Mandatory Elements
(1) Shipper name and address (For empty rail cars, the shipper may be
the railroad from whom the rail carrier received the empty rail car to
transport.)
(2) Consignee name and address (For empty rail cars, the consignee may
be the railroad to whom the rail carrier is transporting the empty rail
car.)
(3) Port of lading
(4) Port of unlading
(5) Bill of lading type (Master, House, Simple or Sub)
(6) Bill of lading numbers (Master, House, Simple or Sub)
(7) AES (ITN) or In-bond number (per shipment)
(8) Cargo description
(9) Weight of cargo (may be expressed in either pounds or kilograms)
(10) Quantity of cargo and unit of measure
(11) Employer Identification Number (EIN) or Importer Record Number or
CBP assigned number.
Conditional Elements
(1) In-bond type
(2) Notify party name and address
(3) Secondary notify party name and address
Optional Elements
(1) Mexican Pedimento Number (only for shipments for export to Mexico)
(2) Secondary notify party SCAC
(3) Country of ultimate destination
(4) Number of house bills of lading
When participants transmit the EEM cargo and transportation data to
CBP via ACE, CBP will validate or notify the responsible party of any
holds. Additionally, a CBP officer will review the finalized train
consist prior to the train's departure from the U.S. port of export.
CBP anticipates that obtaining this data through the integrated system
will help CBP work with rail carriers and other parties to address
almost all issues identified during the CBP review before the train
reaches the U.S. port of export and possibly before loading of the
cargo. This will significantly reduce any delays at the U.S. port of
exports in instances where CBP officers conduct review and address
issues while the train is at the U.S. port of export. CBP anticipates
that through the obtaining of pre-departure rail EEM data, CBP officers
will be able to conduct the appropriate risk assessment and screening
and complete their review of all export manifest data prior to a
train's arrival at the U.S. port of export.\37\
---------------------------------------------------------------------------
\37\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on November 8, 2022.
---------------------------------------------------------------------------
In the initial Test, CBP requested that 32 data elements be
transmitted two hours prior to the cargo loading. The experience gained
during the Test has allowed CBP to revise which data elements should be
mandatory, conditional, optional, and unnecessary. Of the original 32
data elements put forth in the initial Test, five data elements were
determined by CBP to be unnecessary and CBP no longer requests these
EEM data elements in this final rule. CBP lists these below.
(1) Car Locator Message
(2) Empty Indicator (yes/no)
(3) Hazmat Indicator
(4) Split Shipment Indicator (Yes/No)
(5) Portion of split shipment (e.g., 1 of 10, 4 of 10, 5 of 10--Final,
etc.)
As an enforcement tool, this final rule provides CBP with authority
to impose liquidated damages on parties that do not provide the
mandatory EEM data in the manner and in the time frame required. CBP
may assess liquidated damages when a violation occurs. Any party that
violates the requirements for data transmission as described above in
this final rule is subject to liquidated damages of $5,000 for each
violation and up to a maximum of $100,000 per departure. Although there
is the possibility for liquidated damages, compliance is CBP's goal and
CBP aspires to work alongside rail carriers and other parties to ensure
that trade members provide the proper data in a timely manner, so that
CBP can properly review the data, conduct risk assessment, identify
high-risk shipments, and enforce U.S. export laws and regulations on
U.S. rail exports.\38\
---------------------------------------------------------------------------
\38\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
---------------------------------------------------------------------------
Time Periods of Analysis
This analysis primarily focuses on the potential impacts of this
final rule after it will be in effect, but it also includes a
discussion of the impacts during the Test that was in place before the
final rule is finalized. The costs, cost savings and benefits of the
Test are sunk (already incurred and cannot be recovered) for the
purpose of deciding whether to proceed with the final rule, but they
are important for understanding the full costs and benefits of
implementing the rail EEM as a whole. To give the reader a full view of
the effects of CBP's requiring rail EEM data throughout the entire span
of time, CBP analyzes the effects of implementing rail EEM collection
over two time periods comparing each time period to the baseline
scenario that existed prior to the rail EEM Test. First, CBP analyzes
the effects from Test used for the collection of pre-departure manifest
data on rail exports during the pilot period, fiscal years 2016-
2025.\39\ Second, CBP analyzes the effects of the final rule which will
mandate the transmission of EEM data in the rail environment during the
five-year regulatory period, beginning in fiscal year 2026 and ending
in fiscal year 2030. For the regulatory period, CBP estimates, to the
extent data is available, the additional total projected costs, cost
[[Page 55194]]
savings and benefits to the Federal government, rail carriers and other
trade members as a result of requiring the transmission of EEM data for
trains departing the United States, compared to the baseline scenario.
In the analysis for this final rule, CBP defines the pilot period as
fiscal years 2016-2025 and the regulatory period as fiscal years 2026-
2030. At the conclusion of the analysis, CBP includes tables showing
the effects of the final rule across both periods--effectively showing
the full results of the pilot and the final rule against the baseline
(the world without the rail EEM Test). While CBP provides information
about the two time periods separately for full transparency and to make
clear which costs are sunk and which are incremental to this final
rule, CBP also sums the two time periods for a full accounting of the
effects of the rail EEM program as a whole. Additionally, all
references to years are for fiscal years unless otherwise noted.
---------------------------------------------------------------------------
\39\ CBP anticipates that the Test would still be active until
fiscal year 2026 when the final rule will be implemented; however,
at the time this analysis was written CBP only had actual data up
through fiscal year 2024. Therefore, CBP provides estimates, not
actual data, for the fiscal year 2025 in this analysis. CBP compares
the costs, cost savings and benefits during the Test to the baseline
scenario, CBP assumes these effects to be sunk and are not
incremental to this rule.
---------------------------------------------------------------------------
Population Affected by Rule
CBP expects that this final rule will affect a number of different
parties. During the regulatory period, as the transmitting of EEM data
expands, CBP expects broader effects on rail carriers, other trade
members (such as USPPIs, FPPIs, NVOCCs, freight forwarders, customhouse
Brokers (CHB), or other parties with knowledge of manifest data
elements), CBP, and other Federal government agencies that oversee U.S.
exports. CBP expects that this final rule will affect all seven rail
carrier companies currently exporting cargo from the United States by
rail. Although CBP does not have the necessary data to provide an exact
estimate for how many other trade members this final rule will affect,
CBP acknowledges that this final rule could result in some minor
effects to a large number of other trade members, specifically in case
they elect to provide EEM data directly to CBP via ACE. CBP expects
that this final rule will also improve the facilitation of the export
process at around 68 U.S. ports of export, currently conducting the
exportation of goods from the United States in the rail environment.
Because the Test was limited in scope, the effects were largely
experienced by a few rail carriers, possibly some other trade members
and CBP during the pilot period. Although CBP only made the initial
Test available to nine carriers, CBP then extended the Test to all
eligible parties; however, only two rail carriers actively participated
in the Test. The two rail carriers participating in the rail EEM Test
have similar business characteristics to the remaining rail carriers
that will be affected by this final rule. All are large carriers that
operate internationally. Therefore, CBP anticipates that the effects on
the rail carriers participating in the rail EEM Test accurately
represent the effects that the remaining rail carriers will experience
from this final rule.
Rail EEM Test Data and Export Rail Projections
In the analysis for the NPRM, CBP was able to identify the number
of export manifest data transmissions and train consists transmitted
electronically by participating rail carriers during the Test from
2016-2023. Since the NPRM was published, CBP now has data from rail EEM
test for 2024 and CBP has adjusted its estimates in this analysis for
the final rule to reflect this new data. Because CBP's pilot period
includes a future year, CBP does not have actual Test data available
for 2025. To address this issue CBP provides an estimate for the final
year of the pilot period. This estimate is based on actual data in
previous years. From 2016-2024 rail EEM Test participants provided a
total of 1,756,481 export manifest data transmissions and 13,618 train
consists electronically to CBP via ACE.\40\ To estimate the number of
export manifest data transmissions that will occur during the final
year of the pilot period CBP used the average number of rail EEM data
transmissions from 2017-2024 (208,920) and the average number of train
consists submitted electronically to CBP from 2021-2024 (3,011).\41\
According to CBP's projections for the final year of the pilot period
and the actual data obtained (2016-2024), CBP expects that during the
entire pilot period rail EEM Test participants will transmit around
1,965,401 export manifest data transmissions and 16,629 electronic
train consists. Total electronic data transmissions to CBP from
participants in the rail EEM Test would be 1,982,029 during the pilot
period.\42\ Table 2 below displays CBP's actual and estimated number of
export manifest data transmissions and train consists transmitted
electronically to CBP during the pilot period.
---------------------------------------------------------------------------
\40\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 10, 2024, and May 6, 2025. Data obtained from
CBP's ACE.
\41\ CBP excluded 2016 from the average for export manifest data
transmissions due to lack of participation in that year. CBP used
only four years of data 2021-2024 for the electronic train consists
transmitted, because these were the only full years of data during
the pilot period when all train consists were actually transmitted
by participating rail carriers in the Test.
\42\ This number represents the total number of electronic
transmissions sent to CBP by rail EEM test participants (export
manifest data transmissions + electronic train consists).
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[[Page 55195]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.005
Unfortunately, outside of the limited EEM data provided by Test
participants, all other export rail data (excluding data for EEI
requirements) submitted by rail carriers was on paper forms and
therefore CBP was unable to obtain actual rail export volumes (by train
or by train car). Therefore, CBP used train import volume data as a
proxy for train export volume data to calculate the possible number of
EEM data transmissions as a result from this final rule during the
regulatory period. CBP anticipates that the number of train cars
entering the United States from rail imports is likely comparable to
the number of train cars exiting the United States for rail
exports.\43\ CBP used existing internal data on inbound train cars to
project the volume of outbound train cars during the final year of the
pilot period and the regulatory period. Inbound train car volumes have
been largely consistent from 2017-2024 and CBP anticipates that on
average, rail volume should remain relatively constant in future years
as compared to the volumes recorded over the past eight years.
---------------------------------------------------------------------------
\43\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on June
21, 2022. CBP used car volume instead of train volume because import
volumes by train would be inaccurate since they tracked by rail car
fee payments which are capped per year.
---------------------------------------------------------------------------
CBP estimates that from 2016-2024 there were a total of around 39.5
million train cars departing the United States, or on average 4.4
million each year.\44\ Because CBP anticipates that the outbound train
volume will remain relatively constant during future years, CBP used
the average number of estimated outbound train cars during 2017-2024
(4.2 million) for the number of expected outbound train cars for each
future year.\45\ Although CBP has data available on the number of train
cars, CBP does not know how many actual trains will engage in exporting
goods in the rail environment during the regulatory period. Therefore,
CBP does not know exactly how many train consists rail carriers will
transmit requiring a CBP officer to review each year during the
regulatory period. To provide an estimate for how many train departures
will likely be involved in exporting goods in the rail environment
during the regulatory period, CBP used Test data from 2021-2024 on the
number of simple bills transmitted compared to the number of train
consists transmitted. Over the course of these four years a total of
826,123 simple bills and 12,042 train consists were electronically
transmitted to CBP as part of the Test, or on average approximately
68.6 simple bills per train consist.\46\ CBP used this ratio of simple
bills (train cars) to train consists (trains) and the expected outbound
train cars to estimate the total number of trains that will transmit
electronic train consists when exporting goods from the United States
during future years.
---------------------------------------------------------------------------
\44\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 9, 2024, and May 5, 2025. Data obtained from
CBP's Borderstat and OMR databases on inbound rail statistics from
FY 2017-FY 2024.
\45\ Inbound rail volume decreased significantly between 2016 to
2017 and volume remained relatively the same between 2017-2024.
Therefore, CBP omitted the 2016 inbound rail volumes for the
estimate for the regulatory period volume because CBP expects this
would have skewed the annual volume upward.
\46\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 10, 2024, and May 6, 2025. Data obtained from
CBP's ACE. CBP used only three years of data 2021-2024, because
these were the only full years of data during the pilot period when
all train consists were actually transmitted by participating rail
carriers in the Test. Additionally, CBP notes that most of the time
the ratio of a simple bill to train car is one to one, however a
simple bill could be transmitted for multiple train cars or vice
versa. Because CBP only knows the number of simple bills transmitted
during the Test and not the number of train cars, CBP assumes in
this analysis that the ratio of a simple bill to train car is one to
one, essentially the number of simple bills represents the number of
train cars.
---------------------------------------------------------------------------
CBP anticipates that each year during the regulatory period,
approximately 4,220,861 train cars and 58,194 trains will depart the
United States requiring the transmission of export manifest data. In
total CBP expects that during the regulatory period, rail EEM
participants will transmit approximately 21,395,279 data transmissions
to CBP or around 4,279,056 annually. Table 3 below displays CBP's
estimate for total outbound train cars and trains during 2016-2024 and
projected outbound train cars and trains for the final year of the
pilot period and the regulatory period, and the estimated total EEM
data transmissions during the regulatory period.
[[Page 55196]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.006
In addition to the number of export manifest data transmissions and
train consists transmitted electronically from 2016-2024, CBP also
obtained information from the Test on the number of 2H Documentation
and 1H Enforcement holds that were issued during these years. According
to CBP internal data as part of the rail EEM Test from 2016-2024 CBP
issued a total of 51,040 2H Documentation holds and 1,188 1H
Enforcement holds.\48\ To determine the number of holds that will be
issued by CBP in the final year of the pilot period CBP used the
percent of export manifest data transmissions that resulted in a 2H
Documentation or a 1H Enforcement hold from 2020-2024. Based on the
information obtained during the Test, on average a 2H Documentation
hold was issued on approximately 5.0 percent of all export manifest
data transmissions and on average a 1H Enforcement hold was issued on
0.10 percent of all export manifest data transmissions. To estimate the
number of holds issued in 2025 CBP multiplied the percentage of EEM
data transmissions resulting in a 2H Documentation hold (5.00%) and 1H
Enforcement hold (0.10%) by the expected total number of rail EEM data
transmissions for 2025 (see Table 2). CBP anticipates that during the
pilot period CBP will issue around 61,621 2H Documentation holds and
around 1,405 1H Enforcement holds.
---------------------------------------------------------------------------
\47\ To estimate the number of total outbound train cars in
future years, CBP used the average volume of train cars during the
seven year period (2017-2024) = 4,220,861 annually.
\48\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, and May 10, 2024. Data obtained from CBP's ACE.
---------------------------------------------------------------------------
CBP expects that these holds will be issued at a similar frequency
during the regulatory period. Therefore, to estimate the number of CBP
holds that will be issued during the regulatory period, CBP multiplied
the percentage of data transmissions that will be issued 2H
Documentation holds (5.00%) and 1H Enforcement holds (0.10%) by the
estimated number of total data transmissions (see Table 3), for each
year of the regulatory period. According to CBP's estimates, CBP will
issue a total of 1,068,148 2H Documentation holds or on average 213,630
annually and around 21,890 1H Enforcement holds or on average 4,378
annually during the regulatory period. Table 4 displays CBP's estimates
for total holds that will be issued during the regulatory period.
[[Page 55197]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.007
CBP believes that it is possible that the total number of holds
could be less than these estimates during the regulatory period as rail
carriers and other trade members become more familiar and efficient at
providing the pre-departure EEM data, potentially improving compliance
and limiting the number of holds CBP issues. CBP did not issue any DNL
holds during the Test and does not expect a significant number of DNL
holds to be issued during the regulatory period. If DNL holds are
issued this will be an additional cost to rail carriers, who are
ultimately responsible for loading and not loading cargo.
Pilot Period
Costs
CBP expects that CBP, participating rail carriers, other trade
members incur some costs during the pilot period when compared to the
baseline.\49\ CBP's primary cost during the pilot period was from
implementing the Test EEM data tool into ACE. ACE was already in place
prior to the Test; therefore, CBP did not need to develop an entirely
new system. However, there were some development and ongoing systems
costs to CBP during the introduction and operation of the Test.
Initially, CBP incurred systems costs of approximately $608,000 to
develop and implement the Test EEM tool into ACE.\50\ During the pilot
period, CBP incurs ongoing operations and maintenance costs associated
with the Test, which costs CBP on average approximately $101,350 each
year. CBP estimates that total systems costs to CBP for developing and
operating the Test will be approximately $1.6 million during the pilot
period.
---------------------------------------------------------------------------
\49\ Other trade members would include USPPIs, FPPIs, NVOCCs,
freight forwarders, or other third parties with knowledge of
manifest data elements.
\50\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on December 7, 2022. Rail EEM
ACE cost estimates were provided by CBP's Office of Information and
Technology and provided development and ongoing costs that increase
at a fixed rate each year.
---------------------------------------------------------------------------
CBP also incurs some time burdens while conducting additional
review of EEM data when compared to the baseline. As stated earlier, in
the baseline scenario the rail carriers provided export rail data to
CBP all at once in the finalized train consists at or prior to
departure from the United States. Therefore, under the baseline
scenario, CBP was unable to review export data until the finalized
train consist was submitted. During the Test, participants provided EEM
data on a flow basis, so CBP was able to review the data when
participants transmitted the EEM data and did not have to wait for rail
carriers to finalize all the data and submit it together in the train
consist. When participants transmit the EEM data to CBP via ACE, the
integrated system can identify potential high-risk cargo and issue a 1H
Enforcement hold, which requires manual review from a CBP officer. As
discussed earlier, 2H Documentation holds generated by ACE do not
require any action or response from CBP officers, therefore CBP does
not anticipate any time burden to CBP when a 2H Documentation hold is
issued. CBP estimates that this additional review of each 1H
Enforcement hold imposes an average time burden of approximately 5
minutes
[[Page 55198]]
(0.083 hours) to CBP officers.\51\ In addition to reviewing the EEM
data transmitted, CBP officers also incur time burdens when addressing
and resolving 1H Enforcement holds. Depending on the complexity of the
1H Enforcement hold, the time burden to CBP officers to address and
resolve these holds varies from a few minutes to a few hours if a hold
requires a CBP officer to manually examine cargo or a train car.\52\
CBP does not know how many issued 1H Enforcement holds result in cargo
examinations during the pilot period or if the Test led to additional
examinations when compared to the baseline scenario. However, CBP notes
that the majority of these 1H Enforcement holds do not result in a
cargo examination and CBP officers are able to address and resolve the
majority of these holds in a few minutes.\53\ CBP estimates that, on
average, CBP officers incur an additional time burden of 10 minutes
(0.167 hours) to address and resolve each 1H Enforcement hold.\54\ In
total, CBP expects on average a CBP officer incurs a time burden of
approximately 15 minutes (0.25 hours) to review and resolve each 1H
Enforcement hold.
---------------------------------------------------------------------------
\51\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on August 2, 2022. 1H
Enforcement holds can also be issued by CBP officers upon manual
review of export manifest data.
\52\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
\53\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on November 8, 2022.
\54\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
November 21, 2022. Data obtained from CBP's OMR database.
---------------------------------------------------------------------------
During the pilot period, CBP estimates that rail carriers
transmitted a total of 1,982,029 EEM data submissions as part of the
Test, resulting in approximately 1,405 1H Enforcement holds issued
which required additional review by a CBP officer.\55\ CBP calculates
the time burden to CBP officers during the pilot period by multiplying
the estimated number of 1H Enforcement holds (1,405) by the expected
average time burden to CBP officers to review, address and resolve the
average 1H Enforcement hold (15 minutes, 0.25 hours). CBP expects that
CBP officers will have incurred a time burden of approximately 351
hours (1,405 holds * 0.25 hours) during the pilot period. CBP estimates
the costs to CBP officers by multiplying the total time burden (351
hours) by the average hourly loaded rate for a CBP officer ($88.45) =
$31,056.\56\ Table 5 shows CBP's estimate for the time and cost burden
to CBP officers when reviewing and resolving 1H Enforcement holds
during the pilot period.
---------------------------------------------------------------------------
\55\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 10, 2024, and May 6, 2025. Data obtained by
CBP's ACE and based on CBP estimates for 2025.
\56\ CBP bases this wage on the FY 2024 salary, benefits,
premium pay, non-salary costs, and awards of the national average of
CBP Officer Positions in GS Series 1895. Source: Email
correspondence with CBP's Office of Finance on July 15, 2025. CBP
notes that this average hourly wage rate was $101.44 in the analysis
for the NPRM. The $101.44 wage rate was based on FY 2023 CBP
salaries and was adjusted down to $88.45 according to updated FY
2024 data provided by CBP Office of Finance.
[GRAPHIC] [TIFF OMITTED] TR26AU26.008
[[Page 55199]]
In addition to CBP, rail carrier participants and some other trade
members incurred costs during the pilot period. The Test implemented a
few changes that affect rail carrier participants, such as providing
advance EEM data within CBP-requested deadlines prior to cargo loading
onto trains, transmitting the requested EEM data elements to CBP, and
responding to and addressing any issued holds or questions from CBP
about the data provided. During the pilot period, the participating
rail carriers demonstrated very high levels of compliance with
providing data within the requested deadlines of the Test, as
approximately 94 percent of EEM data provided to CBP was transmitted 24
hours prior to departure.\57\ From 2016-2024, the participating rail
carriers electronically transmitted a total of 1,770,009 EEM data
submissions, including 1,756,481 simple bills and 13,618 train
consists, representing around 4 percent of all estimated export
manifest data submissions.\58\
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\57\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on May
9, 2022, and June 21, 2022.
\58\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 10, 2024, and May 6, 2025. Data obtained from
CBP's ACE, Borderstat and OMR databases. CBP notes that most of the
time the ratio of a simple bill to train car is one to one, however
a simple bill could be transmitted for multiple train cars or vice
versa. Because CBP only knows the number of simple bills transmitted
during the Test and not the number of train cars, CBP assumes in
this analysis that the ratio of a simple bill to train car is one to
one, essentially the number of simple bills represents the number of
train cars. CBP determined the number of total export manifest data
submissions during the pilot period by accounting for if all export
manifest data were transmitted electronically and by assuming one
simple bill per estimated departing train car and one train consist
per departing rain, based on the volume of inbound train cars and
CBP's estimate for the number of simple bills (train cars) per
train.
---------------------------------------------------------------------------
Since CBP requests that rail carriers participating in the Test
continue to provide the paper forms in addition to the EEM data, these
rail carriers incurred an additional time burden to transmit the new
electronic data during the Test. CBP estimates that on average rail
carriers incur a time burden of approximately 40 minutes (0.667 hours)
per train to transmit the EEM data.\59\ Unfortunately, CBP does not
have data on the exact number of total trains for which the
participating rail carriers provided electronic data during the pilot
period.\60\ Therefore, to provide an estimate, CBP used 2021-2024 data
from the Test on the number of simple bills transmitted compared to the
number of train consists transmitted.\61\ Over the course of these
years rail carriers electronically transmitted to CBP a total of
826,123 simple bills and 12,042 train consists as part of the Test, or
on average approximately 68.6 simple bills per train consist. CBP used
this ratio of simple bills (train cars) to train consists (trains) and
the total estimated number of simple bills that were transmitted during
each year of the pilot period (2016-2025) to estimate the total number
of trains for which rail carriers transmitted electronic export
manifest data to CBP. According to CBP's estimates, there were
approximately 28,649 trains that had EEM data transmitted to CBP when
departing the United States. Assuming that the Test participants
transmitted EEM data for approximately 28,649 trains, CBP estimates
that these rail carrier participants incur a time burden of 19,099
hours for transmission purposes (28,649 trains * 0.667 hours). To
estimate the time burden costs, CBP multiplied the time burden hours by
the average hourly loaded wage rate for exporters
($36.57).62 63 CBP estimates that, during the pilot period
when transmitting the EEM data to CBP, Test participants incurred a
total cost of around $698,513 or on average $69,851 annually. Table 6
below displays CBP's estimate for the number of trains that depart the
United States, provide EEM data, the estimated time burden, and the
costs to rail carriers during each year of the pilot period.
---------------------------------------------------------------------------
\59\ Information was obtained from feedback and discussions with
Trade members on the potential impacts of providing EEM data in
addition to the paper forms. Data obtained in February 2023.
\60\ Rail EEM Test participants did not start providing the
train consists electronically to CBP on a consistent basis until
2021, therefore CBP does not know how many actual trains had
electronic data transmitted to CBP earlier in the pilot period.
\61\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 10, 2024, and May 6, 2025. Data obtained from
CBP's ACE. CBP used only three years of year of data 2021-2024,
because these were the only full years of data during the pilot
period when all train consists were actually transmitted by
participating rail carriers in the Test.
\62\ CBP calculated this loaded wage rate by first multiplying
the Bureau of Labor Statistics' (BLS) 2024 median hourly wage rate
for Cargo and Freight Agents ($23.99), which CBP assumes best
represents the wage for exporters, by the ratio of BLS' Q4 2024
total compensation to wages and salaries for Office and
Administrative Support occupations (1.4886), the assumed
occupational group for exporters, to account for non-salary employee
benefits. Source of median wage rate: U.S. Bureau of Labor
Statistics. Occupational Employment and Wage Statistics, ``May 2024
National Occupational Employment and Wage Estimates United States.''
Updated April 2, 2025. Available at https://www.bls.gov/oes/2024/may/oes_nat.htm. Accessed June 17, 2025. The total compensation to
wages and salaries ratio is equal to the total compensation cost per
hour worked for Office and Administrative Support occupations
($35.86) divided by the wages and salaries cost per hour worked for
the same occupation category ($24.09). See ``Table 2. Employer Costs
for Employee Compensation for civilian workers by occupational and
industry group.'' Bureau of Labor Statistics, ``Employer Costs for
Employee Compensation--December 2024.'' Released March 14, 2025.
Available at https://www.bls.gov/news.release/archives/ecec_03142025.pdf. Accessed June 17, 2025.
\63\ CBP uses an annual growth rate of 2.42% based on the prior
year's change in the implicit price deflator, published by the
Bureau of Economic Analysis. To adjust to 2025 dollars, multiply by
the 2023-2024 percent change in the Bureau of Economic Analysis's
Implicit Price Deflators for Gross Domestic Product (125.230/
122.273-1). See ``Table 1.1.9. Implicit Price Deflators for Gross
Domestic Product,'' Line 1 Gross Domestic Product, annual. Bureau of
Economic Analysis. Updated May 30, 2025. Available at https://apps.bea.gov/iTable/?reqid=19&step=2&isuri=1&categories=survey#eyJhcHBpZCI6MTksInN0ZXBzIjpbMSwyLDMsM10sImRhdGEiOltbImNhdGVnb3JpZXMiLCJTdXJ2ZXkiXSxbIk5JUEFfVGFibGVfTGlzdCIsIjEzIl0sWyJGaXJzdF9ZZWFyIiwiMjAxNiJdLFsiTGFzdF9ZZWFyIiwiMjAyNCJdLFsiU2NhbGUiLCIwIl0sWyJTZXJpZXMiLCJBIl1dfQ==. Accessed June
17, 2025.
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[[Page 55200]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.009
Rail carriers participating in the Test and other trade members
also faced time burdens and costs when responding to 2H Documentation
holds and 1H Enforcement holds. According to CBP internal data and
estimates for 2025, during the pilot period, CBP will have issued a
total of 61,621 2H Documentation holds and 1,405 1H Enforcement holds.
CBP did not issue any DNL instructions during the Test.\64\ By the end
of 2024, rail carriers showed high rates of compliance and
responsiveness to CBP holds during the Test, with over 99.9% of holds
being resolved and cargo released.\65\ CBP expects that the time burden
to respond to each hold depends on the complexity of the issue and if
the hold results in an examination of cargo which will be more time
consuming. When responding to holds, if a rail carrier does not have
the necessary information and needs to obtain the data from another
trade member, that will also impose a time burden on the other trade
member. CBP believes that on average the overall time burden to trade
(rail carriers and other trade members) when reviewing and addressing
these holds is approximately 12.5 minutes (0.21 hours) per hold.\66\
Based on CBP Test data and estimates for 2025, there were a total of
63,025 holds issued during the pilot period (see Table 4) and CBP
estimates these holds imposed a time burden to trade of around 13,130
hours (63,025 holds * 0.21 hours per hold). CBP estimated the cost to
trade by multiplying the total expected hours spent reviewing and
addressing holds (13,130) by the average hourly loaded wage rate for
exporters ($36.57). CBP expects that during the pilot period reviewing
and addressing holds issued by CBP cost trade approximately $480,214 or
on average $48,021 annually. Table 7 shows CBP estimates for the total
number of holds issued, the estimated time burden, and costs to rail
carriers during each year of the pilot period.
---------------------------------------------------------------------------
\64\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, and June 11, 2025.
\65\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on May
6, 2025. Data obtained from CBP's ACE.
\66\ Data obtained from CBP discussion with Trade members on the
potential costs to review and resolve holds issued by CBP in
response to EEM data transmitted. Time burdens vary greatly
depending on the complexity of the issue; CBP took this into
consideration when calculating the average time burden to review and
address an issued hold. Data obtained in February 2023.
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[[Page 55201]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.010
From the Test, CBP does not know to what extent obtaining pre-
departure EEM data resulted in identifying additional high-risk cargo
or other compliance issues, beyond what CBP would have identified in
the absence of the Test. CBP notes that for all pre-departure EEM that
was transmitted to the Test, CBP was able to use ATS for risk
assessment compared to the baseline scenario where CBP was only able to
use ATS on a very limited number of export cargo data in the rail
environment.\67\ If CBP identifies more high-risk cargo as a result of
the Test, that may result in larger time burdens on rail carriers to
respond to and address CBP requests for cargo examination.
---------------------------------------------------------------------------
\67\ CBP can only use ATS on electronically transmitted data;
therefore, because the majority of export manifest data provided to
CBP prior to this rule was submitted in paper and or via email, CBP
was not able to use ATS to screen any cargo associated with these
paper forms.
---------------------------------------------------------------------------
During the pilot period, rail carriers that voluntarily
participated in the Test incurred costs to adjust and maintain their IT
systems to interact with CBP's ACE and provided the required pre-
departure EEM data to CBP. The EEM data requirements are very similar
to data requirements for advance electronic import manifest data
required during the import process.\68\ Because rail carriers already
had developed systems for those electronic processes at import, Test
participants did not need to develop entirely new IT systems to
transmit EEM data for the Test, but rather rail carriers made
adjustments to their already existing internal systems.\69\ As rail
carriers already have systems to interface with ACE for import filings,
among other things, systems needed to be modified rather than
developed. In addition, rail carrier employees who file information for
imports are typically the same who file for export. The cost of
adjusting and maintaining internal systems to support providing EEM
data to CBP can vary depending on the rail carrier or trade member.
Therefore, CBP provides a range of estimates for the internal system
costs to the average Test participant during the pilot period. CBP
estimates that the annual internal systems costs required to
participate in the Test could range from $10,000 to $60,000 each
year.\70\ CBP used the midpoint within the range, $35,000, as CBP's
primary estimate for annual internal systems costs to the average rail
carrier participating in the Test. As alternate estimates, CBP used a
low estimate of $10,000 and the high estimate of $60,000 for the annual
internal systems costs per year. According to CBP's primary estimate,
the two Test participants incurred approximately $700,000 in total
costs to adjust and maintain their internal systems for providing EEM
data to CBP during the pilot period.\71\ CBP's alternate low and high
estimates show that internal systems total costs to the two rail
carriers were between $200,000 and $1,200,000 during the pilot period.
Table 8 displays CBP's range of cost estimates for annual internal
systems costs to the two rail carrier participants during the pilot
period.
---------------------------------------------------------------------------
\68\ Data obtained from feedback provided by Trade members on
similarities between providing electronic import manifest data and
the requested EEM. Data obtained in December 2022 and February 2023.
\69\ Data obtained from feedback provided by Trade members on
potential necessary development, adjustments and maintenance of
existing internal systems to support providing EEM to CBP via ACE.
Data obtained in December 2022 and February 2023.
\70\ Data was obtained from feedback from Trade members on the
potential costs to internal systems to support providing EEM to CBP
via ACE. Data was obtained in December 2022 and February 2023.
\71\ CBP does not anticipate additional rail carrier or trade
member volunteers in the Test in 2025 and therefore CBP assumes that
the same two participates will be the only trade members that incur
systems costs during the pilot period. Therefore, CBP assumes
remaining rail carriers and any other trade members who elect to
directly participate as a transmitter will start incurring systems
costs in 2026.
---------------------------------------------------------------------------
[[Page 55202]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.011
CBP estimates that total overall costs from the Test during the
pilot period were approximately $3.5 million or on average $353,122.
Total estimated costs to CBP and trade as a result of the Test are
displayed below in Table 9. CBP estimates that during the pilot period
CBP incurred costs of approximately $1.65 million or on average
$165,250 annually. According to CBP's primary estimate for total costs
to trade members from participating in the Test during the pilot
period, costs were approximately $1.88 million or on average $187,873
annually.
[GRAPHIC] [TIFF OMITTED] TR26AU26.012
[[Page 55203]]
Cost Savings
The implementation of the Test also provided cost savings during
the pilot period. As CBP expected, obtaining EEM data through the Test
is a more efficient process than obtaining export data from paper
forms. CBP officers manually review all finalized train consists prior
to a train's departure from the United States, regardless of whether
rail carriers submit the train consists in paper or electronic form.
During the pilot period, when CBP received electronic finalized train
consists from participating rail carriers, the time burden to review
those consists decreased substantially compared to reviewing the paper
consists. Additionally, CBP officers are able to conduct and complete
their review of a transmitted electronic train consist prior to that
train's arrival to the U.S. port of export.\72\ CBP's review of these
train consists required on average 35 minutes (0.583 hours) when
transmitted electronically compared to an average of 2.5 hours when
they were submitted to CBP on paper forms.\73\ To estimate the total
time savings, CBP multiplied the average time savings of reviewing a
train consist transmitted electronically (2.5 hours-35 minutes = 1.92
hours) by the total number of estimated train consists that will be
transmitted electronically during the pilot period (16,629, see Table
2). CBP estimates that the Test generated time savings of approximately
31,871 hours to CBP officers. CBP then multiplied the estimated time
savings (31,871 hours) by the average hourly loaded rate for a CBP
officer ($88.45) to estimate the total cost savings of approximately
$2.8 million to CBP during the pilot period. Table 10 shows CBP's
estimates for the time savings and cost savings to CBP officers from
swifter review of electronic train consists for each year of the pilot
period.
---------------------------------------------------------------------------
\72\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
November 8, 2022. With electronic transmitted data, the system
assists in much of the cargo screening and review of the data
allowing CBP to conduct a quicker and more thorough review of export
manifest data.
\73\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
August 2, 2022.
[GRAPHIC] [TIFF OMITTED] TR26AU26.013
Rail carriers also experienced time and cost savings from the Test
resulting in a more efficient export process at the U.S. port of
export. Rail carriers generally support CBP's transition to EEM data
because rail carriers acknowledge that the former process of providing
export information on paper forms is inefficient and unnecessarily
burdensome to all parties involved. Additionally, the existing export
process using paper forms is inconsistent with the import process which
has already transitioned to electronic data transmission. Rail carriers
have experienced a more efficient import process as a result, and they
acknowledge the potential for improvements to the export process from
providing electronic data.
CBP's review of electronic train consists is significantly quicker
than train consists in paper form. In the baseline scenario, CBP does
not know how often rail carriers sent finalized train consists by email
in advance of departure and to what extent CBP officers were able to
fully conduct their review of the paper train consist prior to the
train's arrival to the U.S. port of export. If CBP officers, prior to
the Test, were unable to start their review of a train's consist before
the train reached the U.S. port of export and the train was held at the
U.S. port of export until CBP officers conducted a review of the train
consist, then participants in the Test experienced a time savings
similar to that estimated above for CBP's officers during CBP's review
process (1.92 hours) when transmitting an electric train consist.
However, CBP does not know in the baseline scenario the extent to which
rail carriers sent finalized pre-departure data via email to CBP
providing CBP officers enough time to review the paper train consists
prior to the train's arrival to the U.S. port of export. Therefore,
during the pilot period CBP does not know exactly how much time savings
rail carriers
[[Page 55204]]
experience from a swifter CBP review of electronic train consists at
the U.S. port of export. To estimate the potential time savings to rail
carrier participants during the pilot period from quicker CBP
processing time, CBP provides a range of time savings under a few
situations that could occur in the baseline scenario depending on the
amount of review CBP officers complete before the train's arrival to
the U.S. port of export.
In Scenario 1, where CBP officers did not begin the review of paper
train consists until the train arrived at the port, rail carriers
participating in the Test will experience on average a time savings of
1.92 hours per train from a more efficient CBP review using electronic
train consists, assuming no 1H Enforcement holds, or other issues CBP
identified during the review of the consist. In Scenario 2, during the
baseline, where rail carriers sent finalized train consists by email
pre-departure and CBP officers were able to complete their review of
these paper train consists prior to all trains arriving at the U.S.
port of export, rail carriers participating in the Test will likely not
experience any time savings from transmitting electronic train
consists. CBP anticipates that in this scenario CBP officers were able
to fully complete their review of the paper or electronic train consist
prior to the train's arrival to the U.S. port of export avoiding any
delays to departure from CBP officers conducting their review at the
U.S. port of export. CBP is uncertain to what extent these time savings
are experienced by rail carriers during the pilot period; however, CBP
believes that it will likely be between 1.92 hours and zero hours per
train. For the purposes of this analysis, CBP uses Scenario 3, which is
the mid-point between the two values (0.96 hours), as the primary
estimate for time savings per electronic train consist reviewed during
the pilot period. CBP also considered a Scenario 4 which assumes CBP
officers were able to complete 25 percent of the review of finalized
train consists prior to a train's arrival at the U.S. port of export
during the baseline.
---------------------------------------------------------------------------
\74\ To provide additional possible outcomes CBP also includes
Scenario 4 which assumes CBP officers were able to complete 25
percent of the review of finalized train consists prior to a train's
arrival at the U.S. port of export.
---------------------------------------------------------------------------
For illustrative purposes, CBP presents these potential time
savings to rail carriers in range estimates based on how much review
CBP officers completed prior to a train's arrival to the port in the
baseline. CBP multiplied the average time savings per train by the
estimated number of electronic train consists transmitted to CBP
(16,629, see Table 2) during the pilot period to estimate the total
potential time savings from expedited CBP processing at the U.S. port
of export. To calculate the cost savings CBP multiplied these potential
time savings by the average hourly loaded wage rate for exporters
($36.57). CBP's primary estimate for time savings and cost savings to
rail carriers from swifter CBP review of train consists will be
approximately 15,963 hours and $583,828. Table 11 displays CBP's
primary estimate along with range estimates for potential time savings
and cost savings to rail carriers at the U.S. port of export during the
pilot period depending on if during the baseline CBP officers were able
to complete 0 percent of their review of train consists, 25 percent of
their review and 100 percent of their review prior to a train's arrival
at the U.S. port of export.\74\
[GRAPHIC] [TIFF OMITTED] TR26AU26.014
CBP expects that participating rail carriers also experienced
additional time savings from the Test when compared to the baseline
when making corrections to transmitted data.\75\ Making updates and
corrections to data transmitted electronically is significantly more
efficient than making updates and corrections to emailed paper forms.
Additionally, the Test allowed participants to transmit data when it
became available, and the Test allowed them to continuously edit and
update data in ACE on a flow basis. CBP estimates that during the pilot
period making such corrections when transmitting EEM data saved Test
participants on average 15 minutes (0.25 hours) per train.\76\ To
calculate the time savings, CBP used the estimate discussed earlier for
total trains that had electronic data transmitted during the pilot
period (28,649, see Table 6) multiplied by the expected time savings
per train (0.25 hours). CBP estimates that the total time savings to
rail carriers from making data corrections in the electronic
environment were approximately 7,162 hours during the pilot period. CBP
multiplied the estimated time savings by the average hourly loaded wage
rate for exporters ($36.57) and anticipates the total cost savings to
rail carrier participants from making data corrections in the
electronic environment was approximately $261,942 or on average $26,194
annually during the pilot period. Table 12 shows CBP's estimate for
time savings and cost savings to rail carrier participants while making
data corrections to EEM compared to paper forms during the pilot
period.
---------------------------------------------------------------------------
\75\ Information was obtained from feedback and discussions with
Trade members on the potential effects of providing EEM data. Data
obtained in February 2023.
\76\ Information was obtained from feedback and discussions with
Trade members on the potential effects of providing EEM data. Data
obtained in February 2023.
---------------------------------------------------------------------------
[[Page 55205]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.015
CBP anticipates there was a savings to rail carriers during the
Test when CBP identified issues before trains were loaded and
assembled. In the baseline scenario, when CBP identified a high-risk
cargo, the cargo already had been loaded onto the train, requiring a
burdensome and time-consuming process to detach or unload the cargo
from an assembled train. CBP estimates that to physically detach a
freight car from an assembled train typically costs around $3,000 and
can result in a delay of up to two hours.\77\ This includes the freight
and labor costs to safely decouple a train car from a built train.
Under this rule, the pre-departure EEM data transmitted to CBP will
improve CBP's ability to identify high-risk cargo before it is loaded
onto a train, avoiding the costly action of deconstructing trains and
unloading cargo for examination. CBP does not track the number of cargo
examinations and was unable to generate an estimate for the average
number of cargo examinations each year, but feedback received from
trade members suggests that such examinations are not a frequent
occurrence.\78\
---------------------------------------------------------------------------
\77\ Information was obtained from feedback and discussions with
Trade members on the potential costs and time burden to remove a
train car from a constructed train in order for CBP to conduct an
examination of the cargo or container. Data obtained in February
2023.
\78\ Information was obtained from feedback and discussions with
Trade members on the frequency of cargo examinations prior to the
Test and during the Test suggesting such an occurrence was fairly
uncommon. Data obtained in February 2023.
---------------------------------------------------------------------------
CBP estimates that during the pilot period total cost savings as a
result of the Test was approximately $3.66 million or on average
$366,479 annually. CBP expects that trade will have experienced a total
cost savings of approximately $854,770 or on average $84,577 annually.
Table 13 displays CBP's estimates for cost savings to CBP, trade and
total overall cost savings during the pilot period as a result of the
Test.
[[Page 55206]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.016
In the NPRM, CBP requested feedback and comments from rail carriers
and other trade members on the costs and cost savings to rail carriers
and other trade members during the Test pilot period; however, CBP did
not receive any comments specifically in regards the Test pilot period
cost and cost savings estimates. Some commenters said that the pilot
was not representative as only two carriers participated. CBP
acknowledges that it is possible that the carriers may have different
costs and for this reason presents a range of estimates. CBP did not
receive any public comments regarding the range of costs used, so we
adopt them again in this analysis for the final rule.
Benefits
According to the Trade Act, CBP is authorized to establish
regulations that provide for the mandatory electronic transmission of
data by way of a CBP-approved electronic data interchange before cargo
arrives in or departs the United States in all environments (sea, air,
rail, and truck). The Test was developed and implemented as a way for
CBP to test a feasible process to meet its requirements, as per the
Trade Act. In addition to meeting its statutory requirements, CBP
experienced benefits during the pilot period. CBP does not have the
data available to quantify these benefits and therefore will discuss
these benefits qualitatively. The primary benefit of requiring pre-
departure EEM data is improving CBP's security efforts and its ability
to use ATS to identify high-risk cargo prior to departing the United
States, while minimizing the disruption to the export process. In the
baseline, CBP officers usually manually review train consists at the
time of departure without using CBP's ATS, so CBP cannot take advantage
of the ATS risk assessment during the rail exit process. All EEM data
transmitted to CBP as part of the Test are screened by CBP using ATS
prior to departure, providing a more robust review and improving CBP's
security efforts. Additionally, the gained efficiencies from obtaining
data in an integrated system allow CBP to review export rail data more
efficiently prior to departure and provide CBP officers with the
ability to allocate more time to mission-critical activities of cargo
security and safety.
Net Impact
CBP has provided its primary estimates for the total costs and cost
savings from the Test during the pilot period, displayed in Table 14.
CBP estimates that the net cost savings were approximately $133,563 or
on average $13,356 annually.
[[Page 55207]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.017
Table 15 displays CBP's primary estimate for quantifiable effects
from the Test adjusted for discounting. In the NPRM for this rule CBP
estimated that using two percent discount rate during the pilot period
resulted in net cost savings.\79\ However, after updating the analysis
to reflect 2024 data CBP estimates that the three and seven percent
discount rates now show a net costs a net cost savings during the pilot
period. As shown, CBP expects that this the Test resulted in total
effects to CBP, rail carriers and other trade members during the pilot
period ranging from a cost of around $106,701 (2025 U.S. dollars) using
a three percent discount rate to a net cost of $327,018 (2025 U.S.
dollars) using a seven percent discount rate. CBP estimates that
annualized net effects ranged from a cost of around $12,509 using a
three percent discount rate to a cost of around $46,560 using a seven
percent discount rate.
---------------------------------------------------------------------------
\79\ CBP used a two percent discount rate for the NPRM
(published in 2024) based on updated guidance for OMB Circular A-4
in 2023 which has since been repealed. Therefore for this final rule
CBP uses a 3 percent and 7 percent discount rates as per existing
OMB Circular A-4 guidance.
[GRAPHIC] [TIFF OMITTED] TR26AU26.018
[[Page 55208]]
Regulatory Period
For the regulatory period, CBP estimated the future costs, cost
savings, and benefits to rail carriers, the Federal government, and
other trade members as a result of requiring EEM data in the rail
environment. CBP anticipates the effects of the final rule will be
similar to those experienced during the pilot period but on a larger
scale as the final rule will make transmission of pre-departure EEM
data mandatory for all U.S. exports in the rail environment.
Costs
CBP anticipates that this final rule will result in costs to both
CBP and trade members during the regulatory period. CBP will bear
technology and opportunity costs by expanding the existing Test to a
requirement for all rail carriers. CBP does not anticipate it will
incur any costs to develop new systems during the regulatory period
because CBP completed the system development and implementation of the
rail EEM data tool application into ACE during the pilot period. CBP
does expect to incur some ongoing systems operations and maintenance
costs associated with the rail EEM data application in ACE. Over the
course of the regulatory period, CBP estimates that ongoing systems
costs in ACE will be approximately $586,026 or on average $117,205 each
year.\80\
---------------------------------------------------------------------------
\80\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on December 7, 2022. Rail EEM
ACE cost estimates were provided by CBP's Office of Information and
Technology, ongoing costs are expected increase at a fixed rate each
year.
---------------------------------------------------------------------------
In addition to the ongoing systems costs, CBP expects to incur
additional time burdens as a result of CBP officers manually reviewing,
addressing and resolving 1H Enforcement holds. CBP estimates that a
total of 21,890 1H Enforcement holds will be issued during the
regulatory period (see Table 4 above). CBP expects that the time burden
to a CBP officer to manually review a 1H Enforcement hold on average is
about 5 minutes (0.083 hours). CBP also anticipates that CBP officers
will incur an additional time burden to address and resolve these 1H
Enforcement holds. Depending on the complexity of the hold and if it is
determined that a CBP officer needs to manually examine cargo, the time
burden to CBP officers to address and resolve these holds varies from a
few minutes to a few hours.\81\ CBP expects that the majority of these
1H Enforcement holds issued will not result in a cargo examination.\82\
CBP estimates that the average time burden incurred by CBP officers
during the regulatory period for addressing and resolving 1H
Enforcement holds is the same as during the pilot period, 10 minutes
(0.167 hours).\83\ Combined, CBP expects that that on average the total
time burden to CBP officers during the regulatory period to review,
address and resolve a 1H Enforcement hold is approximately 15 minutes
(0.25 hours). CBP estimates that the final rule will result in 1H
Enforcement holds that will cause an additional time burden to CBP
officers of approximately 5,473 hours (21,890 1H Enforcement holds *
0.25 hours per hold). CBP calculated the costs to CBP officers in the
regulatory period by multiplying the total time burden (5,473) hours by
the average hourly loaded rate for a CBP Officer ($88.45) = $484,050.
Table 16 shows CBP estimates for total costs to CBP during the
regulatory period including ongoing systems and maintenance costs and
the time burden and cost to CBP officers from additional review of 1H
Enforcement holds during the regulatory period. Over the regulatory
period this final rule will cost CBP approximately $1,070,076 or on
average $214,015 annually.
---------------------------------------------------------------------------
\81\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on June
21, 2022.
\82\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
November 8, 2022.
\83\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
November 21, 2022.
[GRAPHIC] [TIFF OMITTED] TR26AU26.019
CBP does not expect that this final rule will result in additional
cargo examinations when compared to the baseline. In the case where CBP
determines it is necessary to conduct a physical examination of cargo
or a container on average a CBP officer is able to complete the
examination and transmit the findings in about 60 minutes.\84\ Given
the CBP officer hourly loaded wage rate of $88.45, CBP estimates the
average time burden cost to CBP to conduct a cargo or container
examination is approximately $88.45 per examination. If there are more
manual examinations of cargo as a result of 1H Enforcement holds when
compared to the baseline, then the time burden to CBP officers during
the regulatory period could be larger than CBP has estimated in this
analysis. Unfortunately, CBP does not have data available on how many
1H Enforcement holds typically result in a cargo examination. However,
because the EEM data is provided in advance of departure CBP will
likely be able to issue holds before trains reach the U.S. port of
export and possibly before cargo is loaded, limiting the time burden
and costs of conducting these cargo examinations when compared to the
baseline scenario.
---------------------------------------------------------------------------
\84\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on December 15, 2022.
---------------------------------------------------------------------------
CBP anticipates that this final rule will result in costs to trade
members in the form of both systems and
[[Page 55209]]
opportunity costs. CBP expects that the remaining rail carriers (five)
that did not participate in the Test will incur costs to adjust and
maintain their IT systems to provide the electronic export manifest
data directly to CBP via ACE. CBP anticipates that the cost of
adjusting and maintaining internal systems can vary depending on the
rail carrier or trade member and therefore CBP provides a range of
estimates for the annual internal system costs to the rail EEM
participants during the regulatory period. CBP anticipates that the
annual internal systems costs will range from the low end $10,000 to as
high as $60,000 each year.\85\ For the primary estimate during the
regulatory period CBP used the same estimate as proposed during the
pilot period, $35,000 in internal system costs to the average rail EEM
participant to maintain its internal systems each year. To provide a
range of cost estimates, CBP also provides estimates if maintaining the
internal systems cost the average Rail EEM participant $10,000 each
year or $60,000 each year. CBP expects that at least the seven rail
carriers will incur these systems costs each year of the regulatory
period; however, CBP does not know how many other trade members will
also elect to participate and provide the EEM cargo data directly to
CBP via ACE thus incurring systems costs. CBP obtained public comments
stating that other trade members would directly participate and would
incur significant investments including IT systems investments when
they transmit rail EEM data to CBP. However, the commenters did not
provide a monetary estimate for the cost to adjust their IT systems and
CBP did not receive and estimate on how many of these other parties
would elect to directly participate as a rail EEM transmitter. Any
potential future cost related to IT systems for other trade members
that voluntarily participate in the rail EEM will likely vary by trade
member. If a trade member has their own internal IT systems then the
cost would be larger when compared to other trade members that use
software vendors, which provide them with the systems to transmit data
to CBP electronically.\86\ CBP notes that it is voluntary for the other
trade members to provide the EEM cargo data directly to CBP. If no
other party provides this EEM cargo data, then it must be provided by
rail carriers. CBP believes that other trade members will only
participate if it were beneficial for their business or company.
Therefore, CBP does not anticipate these other trade members would
participate if it resulted in a net cost and if there is a significant
cost to participate, they must also experience a significant benefit
that is at least as large. To estimate the cost to rail carriers from
operating and maintaining their internal systems to support
participation in providing EEM data, CBP multiplied the average annual
cost by the number of expected rail carrier participants each year
(seven). According to CBP's primary estimate for operating and
maintaining internal systems, rail EEM participants will incur costs of
approximately $1.2 million or on average $245,000 annually. Under CBP's
low estimate, rail EEM participants will incur costs of around $350,000
or $70,000 annually and the high estimate shows internal systems costs
of approximately $2.1 million or $420,000 annually. Table 17 displays
CBP's estimates of internal systems costs to trade members during the
regulatory period.
---------------------------------------------------------------------------
\85\ Data obtained from feedback and discussions with Trade
members on the potential costs associated with internal systems to
support providing EEM to CBP via ACE. Data was obtained in December
2022 and February 2023.
\86\ Trade members using software vendors typically pay an
annual amount for the services and access to software which will
allow them to provide EEM data directly to CBP via ACE. This
feedback was obtained for the Enhanced Air Cargo Advanced Screening
Interim Final Rule, 90 FR 52796 (Nov. 21, 2025).
[GRAPHIC] [TIFF OMITTED] TR26AU26.020
The final rule adjusted data elements and deadlines for the
transmission of EEM data from what CBP established during the Test.
Rail EEM participants (rail carriers and other trade members such as
USPPIs, FPPIs, NVOCCs, freight forwarders, customhouse brokers, or
other third-parties with knowledge of manifest data elements) will
provide the initial filing data elements to CBP 24 hours prior to the
cargo and train departing the U.S. port of export. As stated earlier,
during the Test CBP considered what data elements were most important,
CBP's needs, and what trade members could provide, given the time
frames recommended and CBP adjusted the required data elements for this
final rule. CBP expects that most rail carriers will have access to
most export manifest data early in the planning stages of an export
rail cargo transaction and will be able to comply with the new
deadlines imposed by the final rule. CBP notes that some rail carriers
will have the export manifest data available days in advance prior to
departure and therefore will have all the necessary information to
transmit the initial filing data to CBP and all other export manifest
data well in advance of the 24-hour and 2-hour prior to departure
deadlines.\87\ CBP anticipates that all parties that will participate
in transmitting EEM data to CBP will have the necessary export data
elements to provide the required EEM data within the two-hour prior to
departure deadline.\88\ However, for some rail carriers acquiring the
necessary data for the initial filing 24 hours prior to departure may
require a change in business practices and additional coordination with
other trade members or parties that have the required export
information. CBP does not believe that in such instances the export
manifest data does not exist; rather, the other
[[Page 55210]]
trade member has not yet provided this information to the rail
carrier.\89\ Based on input from some in the trade community, CBP
expected that in such instances the net costs to rail carriers to
obtain this information earlier from other trade members will be
minimal. However, CBP did receive public comment stating that the
assumptions made by CBP, which are based on the rail EEM Test which
experienced limited participation is not a good representation of the
costs to trade members, specifically because data wasn't provided for
trains departing from more difficult ports of export. CBP acknowledges
this comment that the rail EEM Test data was not provided at all ports
of export locations, which could result in different effects on trade
members. Since this comment did not provide quantitative estimates for
these costs, CBP can only discuss these concerns qualitatively. The
requirements of this final rule may result in different effects based
on the port of export and the trade members business processes. CBP
fully expects that trade members may need to make adjustments to their
existing business practices to comply with this final rule. CBP
specifically requested comment on the extent and costs of those
adjustments but did not receive specific monetary estimates of these
expected costs. CBP's analysis for the NPRM included ranges of
estimates as CBP acknowledged that carriers would have different costs
depending on their circumstances. As CBP did not receive comments
regarding these ranges, CBP adopts them as final in this analysis.
Additionally, CBP notes that if other trade members are reluctant to
provide this information to the rail carriers within the 24-hour prior
to departure deadlines the other trade members will be able to provide
this data to CBP directly as a rail EEM transmitter.
---------------------------------------------------------------------------
\87\ CBP obtained feedback and information from Trade members on
when in the export transaction process, the export manifest data is
typically available for them to submit to CBP. Information obtained
in February 2023.
\88\ Data obtained from feedback and discussions with Trade
members on the timeline for when export manifest data elements are
made available and can be provided to CBP. Data was obtained in
February 2023.
\89\ Information provided during discussion with some Trade
members in regard to the timeline for when export manifest data is
available to be provided to CBP and challenges to providing pre-
departure data well in advance. Data obtained in February 2023.
---------------------------------------------------------------------------
The transition from a paper form process to an electronic data
process could also result in parties that provide EEM data adjusting
business practices. CBP expects any costs related to adjusting business
practices will be minimal and should not have a large effect on rail
carriers and other trade members, specifically because they likely
already have such practices developed to provide manifest data for rail
imports.\90\ Additionally, participation in directly providing the rail
EEM data to CBP by other trade members is voluntary; CBP expects that
these parties will likely only directly provide data to CBP if the
benefits outweighed the costs to their company. In the NPRM, CBP
requested comments from rail carriers and trade members on the
potential costs during the regulatory period related to internal system
adjustments, operation and maintenance needed to support transmitting
pre-departure EEM data to CBP via ACE. CBP did not receive any monetary
estimates on these costs from the public comments. Some commenters
noted that costs would vary across different carriers. CBP agrees and,
for this reason, presents a range of costs as well as a central
estimate. Additionally, CBP also requested comments in the NPRM on any
other costs to trade members associated with transitioning from paper
forms to the transmission of EEM data that CBP did not address in this
analysis. CBP did receive comments concerning the potential impact to
NVOCCs from the requirement of providing house-level data. These
commenters stated that requiring NVOCCs to provide house-level data
introduces a new process which doesn't currently exist for NVOCCs, and
this would result in significant investments in programming, process
adjustments, training, and associated costs and will require time to
effectuate. CBP acknowledges that trade members may incur these costs
and may need to adjust business processes in order to meet the
requirements of this rule, and for NVOCCs obtaining house-level data
would be a change. However, it is CBP's understanding that the house-
level data exists in advance of the deadlines for data transmission set
forth in this rule and that NVOCCs will need to adjust current
practices to obtain that information from the exporters in advance to
comply with the requirements of this rule. These commenters state that
these changes will necessitate significant investments, but CBP is
unable to quantify a monetized value based on the information provided.
CBP agrees with the concern raised by these commenters that there could
be significant investments required for NVOCCs and other non-rail
carrier trade members that elect to participate and directly transmit
EEM data to CBP. However, CBP notes that for these trade members direct
participation is voluntary and therefore they will only directly
participate if it makes business sense for them to do so. Additionally,
in this final rule CBP has established a delayed enforcement date (one
year after publication of the final rule) to allow trade members time
to implement any changes needed to meet the requirements of this rule.
---------------------------------------------------------------------------
\90\ CBP requested feedback from Trade members on the potential
costs from adjusting business practices as a result of this rule.
Trade members suggested that there could be some costs but were
unable to provide additional details on the costs for such
adjustments to business practices or if this would be a one-time
adjustment cost or ongoing adjustment costs.
---------------------------------------------------------------------------
CBP expects that rail carriers and other trade members that provide
EEM data to CBP will incur time burdens and costs while responding to
CBP-issued holds. During the regulatory period, the party that provides
the EEM data to CBP is the party responsible for responding to any
questions, holds or issues that arise from CBP's review of that export
data.\91\ During the regulatory period CBP expects that the time burden
to respond to each hold depends on the complexity of the issue. When a
party is reviewing and responding to holds, if that party does not have
the necessary information and needs to obtain the data from another
trade member, that will impose an additional time burden on both
parties. To estimate the time burden to trade to review and resolve the
average hold (including both 2H Documentation holds and 1H Enforcement
holds) during the regulatory period, CBP used the same time burden
estimate as we did for the pilot period-approximately 12.5 minutes
(0.21 hours) to trade when reviewing and resolving each 2H
Documentation and 1H Enforcement hold.\92\
---------------------------------------------------------------------------
\91\ CBP notes that the rail carrier will always be notified of
a DNL or Hold even if they were not the EEM data transmitter.
\92\ Data obtained from CBP discussion with Trade members on the
potential costs to review and resolve holds issued by CBP in
response to EEM data transmitted. Time burdens vary greatly
depending on the complexity of the issue. CBP took this into
consideration when calculating the average time burden to review and
address an issued hold. Data obtained in February 2023.
---------------------------------------------------------------------------
CBP does not expect that such holds will result in CBP officers
conducting additional cargo examinations when compared to the baseline.
Cargo examinations conducted after cargo has been loaded onto the train
are a burdensome and time-consuming process and will result in a larger
time burden to resolve holds that result in an examination. CBP does
not track the number of cargo examinations and was unable to generate
an estimate for the average number of cargo examinations each year, but
feedback received from trade members suggests that cargo examinations
are not a frequent occurrence.\93\ Although CBP does not
[[Page 55211]]
anticipate examinations will increase as a result of this final rule,
if CBP did conduct more examinations when compared to the baseline then
time burden costs to trade members to review and resolve holds could be
higher than what CBP provides in this analysis. Additionally, CBP does
not track and was unable to estimate the number of holds issued that
will result in multiple parties being involved in reviewing and
resolving of holds. If responding to issued holds always requires
multiple parties to be involved, then the time burden to review and
resolve a hold will also likely be higher than the 12.5-minute estimate
CBP provided above.
---------------------------------------------------------------------------
\93\ Information was obtained from feedback and discussions with
Trade members on the frequency of cargo examinations prior to the
Test and during the Test suggesting such an occurrence was fairly
uncommon. Data obtained in February 2023.
---------------------------------------------------------------------------
To estimate the time burden to trade during the regulatory period
when reviewing and resolving holds, CBP multiplied the total number of
expected holds issued each year during the regulatory period by the
estimated average time burden to review and resolve a hold (0.21
hours). CBP expects that during the regulatory period trade members
will review and resolve around 1,090,039 holds (see Table 4) resulting
in a total time burden of approximately 227,091 hours or on average
45,418 hours annually. CBP calculated the costs to trade from reviewing
and resolving these holds by multiplying the total hours of time burden
by the average hourly loaded wage rate for exporters ($36.57). CBP
anticipates that overall costs to trade from reviewing and resolving
holds as a result of this final rule will be around $8.3 million or on
average $1.7 million annually. Table 18 shows CBP's regulatory period
estimates for time burden and costs to trade associated with the review
and resolution of holds issued by CBP.
[GRAPHIC] [TIFF OMITTED] TR26AU26.021
The final rule prohibits rail carriers from transporting cargo with
a hold across the border until the issues have been addressed and the
hold has been lifted. Upon notification of a hold being issued on a
specific cargo the party responsible for providing that information to
CBP will need to contact CBP for specifics and further instructions
regarding the hold. If CBP requires a manual examination of cargo, the
rail carrier must coordinate with CBP to identify a place where a
proper examination of cargo can be conducted. CBP will prohibit a
train's departure from a U.S. port of export if there are any
unresolved holds issued for cargo currently loaded onto a train.
Parties that do not address a CBP-issued hold on specific cargo or
freight cars before the required deadlines could face enforcement
actions. Because CBP experienced very high rates of compliance during
the Test (the compliance rate was over 99.8%), CBP expects excellent
rates of compliance during the regulatory period.\94\ As stated
earlier, CBP's primary goal is compliance and CBP intends to work with
parties providing the EEM data during this process to minimize the
disruption of the flow of goods.
---------------------------------------------------------------------------
\94\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on May
6, 2025. This was based on the number of holds issued and those that
were released in FY 2024.
---------------------------------------------------------------------------
This final rule will also require a party transmitting the EEM data
to CBP to have an appropriate bond on file with CBP that contains the
condition to transmit advance export information in the manner required
by regulation.\95\ This rule goes into effect 60 days after
publication, but CBP will not begin enforcing this rule until one year
after publication, which gives a party expecting to need an appropriate
bond when CBP begins enforcing this rule 300 days to obtain such a
bond, either by terminating and replacing an existing continuous bond
or by obtaining a new bond (continuous or single transaction). At one
year, a bond that does not contain the condition to transmit advance
export information in the manner required by regulation will be deemed
insufficient. CBP received a public comment disagreeing with CBP's
assumption that there would only be negligible additional costs to rail
EEM participants to comply with the bond requirements. Specifically,
this commenter was concerned with rail carriers' responsibility for
transmitting all data elements when no other party elects to transmit
the EEM data to CBP. The commenter is concerned about liquidated
damages assessed against rail carriers based on data that was provided
to rail carriers from other trade members. If a rail carrier receives
information from another party to the transaction, and the rail carrier
cannot reasonably verify the information, the rail carrier is not
liable for a violation if it provides the unverified information to CBP
as long as it reasonably believes the information to be true.
Therefore, rail carriers will not be subject to liquidated damages in
this scenario as they have not violated the regulation. CBP also notes
that all rail carriers that engage in carrying goods for export out of
the United States are also carrying goods for import into the United
States
[[Page 55212]]
and therefore already have a requirement to secure and obtain a bond,
so CBP believes adding this small provision doesn't add a significant
cost to these rail carriers.
---------------------------------------------------------------------------
\95\ The transmitter must have at least one of the following
bonds: CBP Basic Importation and Entry Bond containing the
provisions found in section 113.62 of 19 CFR, a Basic Custodial Bond
containing the provisions found in 113.63 of 19 CFR, or an
International Carrier Bond containing the provisions found in
section 113.64 of 19 CFR.
---------------------------------------------------------------------------
Rail carriers and other trade members could also incur some costs
to meet the requirement of this final rule of having someone readily
available to respond to questions and issues that may arise from CBP's
review for EEM data transmitted. CBP anticipates that any additional
staffing costs to participants would be negligible because they
typically have someone working for other business operations that can
respond to CBP questions and issues.
Rail carriers and other trade members may also be subject to claims
for liquidated damages of $5,000 for each violation and up to a maximum
of $100,000 per departure for noncompliance. These claims imposed by
CBP are a compliance tool and CBP anticipates that there will be high
levels of compliance from participants during the regulatory period
such that violations that result in claim issuance will likely not be a
common occurrence.\96\ Compliance is CBP's primary goal and CBP plans
to work with rail carriers and other trade members to ensure they
provide the appropriate EEM data in a timely manner.
---------------------------------------------------------------------------
\96\ CBP notes if a rail carrier receives information from
another party to the transaction, and the rail carrier cannot
reasonably verify the information, the rail carrier is not liable
for a violation if it provides the unverified information to CBP as
long as it reasonably believes the information to be true.
---------------------------------------------------------------------------
CBP estimated that during the regulatory period total overall costs
of the final rule will be approximately $10.6 million or on average
$2.1 million annually. Table 19 below displays CBP's estimates for
total costs to CBP and trade members as a result of this final rule.
CBP requested feedback and comments in the NPRM on the regulatory
period costs from this rule to rail carriers and other trade members
discussed above and any other cost to rail carriers and other trade
members that CBP did not address in this analysis. CBP received a
comment that CBP did not consider significant infrastructure costs
needed to conduct cargo inspections at border crossings. However, CBP
disagrees that such infrastructure will be required. When EEM data is
provided within the deadlines set forth in this rule, cargo inspections
will be conducted at a U.S. port of export location determined by CBP.
Therefore, CBP anticipates that cargo inspections occurring between the
U.S. port of export and the actual border crossing would be rare
instances where a significant imminent threat is identified after the
train is given clearance and has departed the United States from the
final port of export. Since these will be rare occurrences, CBP does
not believe they will necessitate significant investments from rail
carriers or CBP in additional infrastructure at actual border
crossings.
[GRAPHIC] [TIFF OMITTED] TR26AU26.022
Cost Savings
The mandatory transmission of pre-departure EEM data will generate
cost savings to CBP and some trade members during the regulatory
period. As discussed in the pilot period cost savings section of this
analysis, obtaining and reviewing EEM data is a more efficient process
when compared to working with paper forms. During the regulatory
period, CBP officers will continue to review all train consists prior
to each train departing the U.S. port of export. As the transmission of
EEM data becomes mandatory for all cargo departing the United States in
the rail environment, CBP will experience more time savings through the
expedited review of train consists. To estimate the time savings to CBP
during the regulatory period CBP uses the time savings estimate
provided during the pilot period of 1.92 hours per train consist. CBP
multiplied this time savings per train consist by the forecasted number
of departing trains exporting goods during the regulatory period,
290,972 trains (see Table 3). CBP estimates that as a result of this
final rule CBP will experience time savings of approximately 111,539
hours each year or 557,696 hours in total during the regulatory period.
To calculate the total cost savings, CBP multiplied the time savings
estimate by the average loaded hourly wage rate for a CBP officer
($88.45). CBP estimates that the total cost savings to CBP during the
regulatory period will be approximately $49.3 million or on average
$9.86 million annually. Table 20 displays these estimated time and cost
savings to CBP for each year of the regulatory period.
[[Page 55213]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.023
Because the transmission of EEM data will be mandatory for all
cargo trains departing across approximately 68 U.S. ports of export as
a result of this final rule, rail carriers and other trade members will
likely experience some time and cost savings during the regulatory
period. CBP notes that during the pilot period when Test participants
transmitted all EEM within the required deadlines, CBP officers are
able to complete their review of those train consists prior to that
train's arrival to the U.S. port of export. CBP anticipates this will
also be the case during the regulatory period.\97\ Therefore, the time
savings to rail carriers during the regulatory period from a swifter
CBP processing of an electronic train consist is dependent on how much
review of a paper train consist CBP completed before the train arrives
at the U.S. port of export in the baseline. CBP defines a few potential
scenarios depending on when rail carriers provided export data to CBP
prior to this final rule. In Scenario 1 rail carriers prior to this
final rule did not provide export data pre-departure to CBP--meaning
CBP officers were unable to start their review of the train consist
until the train is at the U.S. port of export--in this scenario CBP
anticipates these rail carriers will experience the same amount of time
savings per train as CBP officers: 1.92 hours per outbound train. For
Scenario 2, rail carriers who, prior to this final rule, provided pre-
departure export data and the finalized train consists to CBP in
advance such that CBP officers were able to conduct and complete their
review of this information before the train arrived at the U.S. port of
export, these rail carriers will likely not experience any time savings
from the expedited CBP review of train consists. As CBP does not have
data prior to this final rule on how many trains transmit pre-departure
export data to CBP in time for CBP to review it, CBP anticipates that
the time savings to rail carriers from the expedited review of
electronic train consists will be somewhere between 1.92 hours to 0
hours per departing train. Similar to the pilot period estimate, CBP
determined to use the midpoint between these two values (0.96 hours) as
Scenario 3 and as CBP's primary estimate for the time savings to rail
carriers per outbound train during the regulatory period. CBP also
provides the potential time savings from Scenario 4 which assumes CBP
officers were able to complete 25 percent of the review of finalized
train consists prior to a train's arrival at the U.S. port of export.
---------------------------------------------------------------------------
\97\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
November 8, 2022.
---------------------------------------------------------------------------
Because of this uncertainty for the actual amount of time savings
to rail carriers from this process CBP provides a range of potential
time savings to rail carriers during the regulatory period using the
same alternate estimates provided in the pilot period portion of this
analysis, assuming CBP officers completed 0 percent of their review of
train consists in Scenario 1 (1.92 hours of time savings per train),
100 percent of their review in Scenario 2 (0 hours of time savings per
train), 50 percent of their review in Scenario 3 (0.96 hours of time
savings per train), and 25 percent of their review in Scenario 4 (0.48
hours of time saving per train) before the train arrives at the U.S.
port of export. CBP estimated the time savings to rail carriers by
multiplying the average time savings per train by the forecasted number
of outbound trains (see Table 3) during each year of the regulatory
period. CBP then calculated a range of potential cost savings each year
of the regulatory period by multiplying the estimated time savings by
the average hourly loaded wage rate for exporters ($36.57). Under CBP's
primary estimate, time savings to rail carriers during the regulatory
period from swifter CBP review of electronic train consists will be
approximately 279,333 hours or on average 55,867 hours annually. Cost
savings to rail carriers will be approximately $10.2 million during the
regulatory period or on average $2.04 million annually. According to
CBP's range of estimates, cost savings to rail carriers from shorter
review time of train consists could be anywhere from $0 to $20.4
million or at most on average $4.1 million annually. Table 21 displays
CBP's primary estimate and alternative range estimates for these
potential time savings and cost savings to rail carriers and other
trade members.
[[Page 55214]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.024
CBP expects that rail carriers, and other trade members that decide
to provide EEM cargo data, will also experience some other time and
cost savings as a result of this final rule. During the regulatory
period, rail carriers will transmit EEM data to CBP and will no longer
submit finalized train consists in paper form to CBP either via email
or at the U.S. port of export. Eliminating the time burden and cost to
provide the paper form train consists will be a cost savings of this
final rule, but parties will now incur the time and cost to provide the
EEM data. CBP expects providing the EEM data takes less time than
providing the data on paper forms and rail EEM participants will
experience a time savings when providing EEM data.\98\ During the
regulatory period, CBP estimates that eliminating paper forms and
providing the EEM data will help rail carriers and other trade members
to automate the process for providing export manifest data to CBP and
will generate a time savings of approximately 20 minutes (0.333 hours)
on average for each train exporting goods out of the United States.\99\
---------------------------------------------------------------------------
\98\ Information was obtained from feedback and discussions with
Trade members on the potential effects of providing EEM data instead
of paper forms. Data obtained in February 2023.
\99\ Information was obtained from feedback and discussions with
Trade members on the potential effects of providing EEM data instead
of paper forms. Data obtained in February 2023.
---------------------------------------------------------------------------
CBP used the number of total outbound trains estimated above
290,972 (see Table 3) for the number of trains that will potentially be
affected and experience this time savings during the regulatory period.
According to CBP calculations, trade members will experience a total of
96,991 hours (290,972 trains * 0.333 hours) in time savings from a more
efficient process of providing the electronic export manifest data when
compared to the baseline. To provide an estimate for the total cost
savings from this process, CBP multiplied the total expected time
savings (96,991 hours) by the average hourly loaded wage rate for
exporters ($36.57). CBP estimates that these cost savings to trade
during the regulatory period will be approximately $3.55 million or on
average $709,447 annually. Additionally, during the regulatory period
CBP expects that rail EEM participants will experience time savings
when making corrections and/or
[[Page 55215]]
updates to electronically transmitted data in ACE when compared to
making corrections and updates to paper forms in the baseline scenario.
CBP uses the same time savings estimate used in the pilot period of 15
minutes (0.25 hours) per train for the time savings experienced by rail
EEM participants during the regulatory period. CBP multiplied this time
savings per train by the expected number of outbound trains during each
year of the regulatory period (58,194 trains, see Table 3). CBP
estimates that rail EEM participants will experience a time savings of
approximately 72,743 hours on average and 14,549 each year from being
able to make updates and corrections to EEM data in ACE when compared
to paper forms. To provide an estimate for the total cost savings from
this process, CBP multiplied the total expected time savings during the
regulatory period (72,743 hours) by the average hourly loaded wage rate
for exporters ($36.57). CBP estimates that these cost savings to trade
during the regulatory period will be approximately $2.66 million or on
average $532,085 annually. Table 22 displays CBP estimates for time
savings to rail EEM participants from transitioning to transmitting EEM
data and making corrections and updates to electronic data in ACE.
Overall, CBP estimates that transitioning to EEM data transmission will
save rail EEM participants approximately $6.2 million or on average
$1.2 million annually.
[GRAPHIC] [TIFF OMITTED] TR26AU26.025
CBP also expects that rail carriers will experience time and cost
savings if the pre-departure EEM data results in CBP identifying a
high-risk cargo prior to that cargo being loaded or added to a train,
thereby avoiding the costly burden of identifying high-risk cargo after
the train has been constructed. CBP did not track how often such
examinations occur prior to the NPRM and CBP was unable to provide an
estimate for how often such examinations occur, but CBP expects that
they are fairly uncommon.\100\ CBP requested comment on this in the
NPRM and received none, so it adopts this position for the final rule
as well. Additionally, CBP does not anticipate this final rule will
result in additional examinations compared to the baseline. CBP
estimates that the cost to rail carriers to remove a car from a
constructed train for CBP examination is approximately $3,000 per
occurrence and results in a delay of up to two hours.\101\ This
includes the freight and labor costs to safely decouple a train car
from a built train. Rail carriers will avoid these costs if CBP
receives pre-departure data and is able to issue holds and examine
these cargo or train cars before constructed to the train.
Additionally, moving to transmission of EEM data will reduce the space
required to store and file paper form manifest documents generating
savings to rail carriers and other trade members. Unfortunately, CBP
does not have data available to provide a quantifiable estimate for the
savings to trade members from reduced storage space as a result of
eliminating paper form manifest documents, but based on feedback from
trade members, does not consider the costs to be substantial.
---------------------------------------------------------------------------
\100\ Information was obtained from feedback and discussions
with Trade members on the frequency of cargo examinations prior to
the Test and during the Test suggesting such an occurrence was
fairly uncommon. Data obtained in February 2023.
\101\ Information was obtained from feedback and discussions
with Trade members on the potential costs and time burden to remove
a train car from a constructed train in order for CBP to conduct an
examination of the cargo or container. Data obtained in February
2023.
---------------------------------------------------------------------------
CBP estimates that total cost savings as a result of this final
rule will be approximately $65.8 million or on average $13.2 million
annually during the regulatory period. In total, CBP anticipates that
trade members will experience cost savings of $16.4 million
[[Page 55216]]
or on average $3.3 million annually during the regulatory period, while
CBP will experience cost savings of around $49.3 million or on average
$9.9 million annually. Table 23 below displays CBP's estimates for
total cost savings to CBP and trade during each year of the regulatory
period. CBP requested feedback and comments during the NPRM from rail
carriers and trade members on CBP's estimates for the cost savings to
trade as a result of this rule and any other potential cost savings
from this rule that CBP may not have included in this analysis;
however, CBP did not receive any comments on this matter.
[GRAPHIC] [TIFF OMITTED] TR26AU26.026
Benefits
CBP expects that parties involved in U.S. rail exports will likely
experience benefits as a result of this final rule during the
regulatory period. Unfortunately, CBP does not have the data available
to quantify these benefits and therefore will discuss these benefits
qualitatively. A primary benefit of requiring pre-departure EEM data
will be an improvement in CBP's security efforts and its ability to use
CBP's ATS to conduct risk assessment for all rail export cargo prior to
departing the United States, while also minimizing the disruption to
the export process. This final rule will assist CBP in preventing
illegal, dangerous, and hazardous cargo from being exported out of the
United States and will allow CBP to ensure cargo safety and security
for all exports in the rail environment. Additionally, transitioning to
electronic data will reduce the use of paper for all parties involved
and bring the outbound rail process level with existing inbound rail
processing technology. The deadlines for transmitting EEM data and the
gained efficiencies from moving from paper forms to electronic data
transmission using an integrated system will provide CBP with more time
to review the necessary detailed export data prior to a train's
departure, allowing CBP officers to allocate more time to mission-
critical activities. CBP also anticipates this final rule will generate
benefits to the Federal government through improved coordination and
communication among CBP, the Department of Commerce, and other
government agencies with export jurisdiction, while enforcing U.S.
export laws and regulations. In addition, CBP will implement the Trade
Act authority in the rail environment, under which CBP may establish
regulations providing for the mandatory electronic transmission of data
by way of a CBP-approved electronic data interchange before cargo
arrives or departs the United States in all environments.
Net Impact of the Final Rule
CBP anticipates that the cost savings generated from this final
rule will outweigh the costs during the regulatory period. In addition,
this final rule generates meaningful unquantified security benefits.
During the regulatory period, CBP anticipates that this final rule will
generate net cost savings to both CBP and trade members. CBP notes that
lack of data available prevented CBP from providing exact estimates for
some of the potential costs and cost savings from the implementation of
rail EEM and therefore the actual net cost savings could be more or
less than what CBP's primary estimates project in this analysis.
Additionally, CBP acknowledges that for other trade members,
participating directly in providing rail EEM data to CBP is voluntary
and CBP expects that they will only do so if it were beneficial to
their company and the benefits or cost savings outweigh the costs.
Because CBP does not have data on how many of these other trade members
will decide to directly participate in providing rail EEM data during
the regulatory period the actual costs and cost savings from this final
rule could be higher than what CBP has provided during the regulatory
period of this analysis. CBP estimates that, during the regulatory
period, CBP, rail carriers, and other trade members will incur
undiscounted costs of approximately $10.6 million or an average of $2.1
million per year. Meanwhile, CBP estimates an undiscounted total cost
savings to CBP, rail carriers and other trade members of approximately
$65.8 million during the regulatory period, or an average of $13.2
million per year. This results in an undiscounted net cost savings of
approximately $55.2 million, or an average of $11.0 million per year.
Table 24 displays CBP's undiscounted estimates for costs and cost
savings to CBP and trade members during each year of the regulatory
period.
[[Page 55217]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.027
[GRAPHIC] [TIFF OMITTED] TR26AU26.028
Table 25 shows the discounted total quantified costs during the
regulatory period from this final rule. As shown, the total costs over
the 5-year regulatory period of analysis will range from around $9.7
million (in 2025 U.S. dollars) using a three percent discount rate and
$8.7 million (in 2025 U.S. dollars) using a seven percent discount
rate. Expected annualized costs from this final rule are about $2.1
million using both a three and seven percent discount rate.
[GRAPHIC] [TIFF OMITTED] TR26AU26.029
Table 26 displays the discounted total quantified cost savings as a
result of this final rule during the regulatory period. CBP's primary
estimates show that this rule will provide cost savings to CBP, rail
carriers and other trade members ranging from $60.2 million (in 2025
U.S. dollars) using a three percent discount rate and $53.9 million (in
2025 U.S. dollars) using a seven percent discount rate. Annualized cost
savings from this final rule will be approximately $13.2 million using
both three and seven percent discount rates.
[[Page 55218]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.030
Table 27 displays CBP's primary estimate for quantifiable net cost
savings from the implementation of rail EEM. As shown, CBP expects that
this final rule will result in total net cost savings to CBP, rail
carriers and other trade members of range from around $50.5 million (in
2025 U.S. dollars) using a three percent discount rate to around $45.2
million (in 2025 U.S. dollars) using a seven percent discount rate. CBP
estimates that annualized net cost savings are approximately $11.0
million using both a three and seven percent discount rate.
Total Impact of the Rail EEM Program
CBP anticipates that over the entire 15-year time period of
analysis 2016-2030, the final rail EEM program will result in overall
net cost savings compared to the baseline (before the rail EEM Test was
introduced). Initially as the rail EEM Test was introduced, costs
outweighed the cost savings, but CBP estimated that as the Test
expanded, and after the final rule will be implemented, cost savings
will far outweigh the costs incurred by this final rule. In addition,
CBP expects that this final rule will generate meaningful unquantified
security benefits after it is implemented as discussed above in the
regulatory period net impact section. CBP estimates that between 2016-
2030 the rail EEM program will result in undiscounted total costs of
$14.1 or on average $0.94 million annually. Additionally, the rail EEM
program will result in undiscounted total cost savings of $69.4 million
or on average $4.6 million annually between 2016-2030. CBP estimates
that undiscounted total net cost savings from the rail EEM program
during the period of analysis 2016-2030 will be $55.3 million or on
average $3.7 million annually when compared to the baseline. Table 28
displays CBP's undiscounted estimates for total costs, cost savings and
net cost savings as a result of this final rule from 2016-2030.
[GRAPHIC] [TIFF OMITTED] TR26AU26.031
[[Page 55219]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.032
Table 29 shows the discounted total quantified costs from the rail
EEM program from 2016-2030 compared to the baseline scenario. As shown,
the total costs over the 15-year period of analysis will range from
$10.3 million (in 2025 U.S. dollars) using a three percent discount
rate to $7.0 million (in 2025 U.S. dollars) using a seven percent
discount rate. Expected total annualized costs from this final rule
range from $859,845 using a three percent discount rate to $764,026
using a seven percent discount rate.
[GRAPHIC] [TIFF OMITTED] TR26AU26.033
Table 30 shows the discounted total quantified cost savings as a
result of this final rule from 2016-2030. As shown, the total cost
savings over the 15-year period of analysis will range from $47.7
million (in 2025 U.S. dollars) using a three percent discount rate to
$29.6 million (in 2025 U.S. dollars) using a seven percent discount
rate. Expected total annualized cost savings from this final rule will
range from $4.0 million using a three percent discount rate to $3.3
million using a seven percent discount rate.
[GRAPHIC] [TIFF OMITTED] TR26AU26.034
Table 31 shows the discounted total quantified net cost savings
from this final rule. As shown, the total net cost savings over the 15-
year period of analysis compared to the baseline will range from $37.5
million (in 2025 U.S. dollars) using a three percent discount rate to
$22.7 million (in 2025 U.S. dollars) using a seven percent discount
rate. Expected total annualized net cost savings from this final rule
will range from $3.1 million using a three percent discount rate to
$2.5 million using a seven percent discount rate. Accounting statements
1 and 2 show the expected costs, cost savings and benefits from this
final rule for the regulatory period and the program as a whole,
respectively. Though CBP presents the costs of the program as a whole,
including both the pilot period and the regulatory period, the costs of
the pilot period are sunk for the purposes of decision-making.
Therefore, CBP considered the net effects for the regulatory period
when deciding whether to proceed with this final rule.
BILLING CODE 9111-14-P
[[Page 55220]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.035
[[Page 55221]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.036
BILLING CODE 9111-14-C
B. Regulatory Flexibility Act
This section examines the impact on small entities as required by
the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), as amended by
the Small Business Regulatory Enforcement and Fairness Act of 1996. A
small entity may be a small business (defined as any independently
owned and operated business not dominant in its field that qualifies as
a small business per the Small Business Act); a small not-for-profit
organization; or a small governmental jurisdiction (locality with fewer
than 50,000 people).
CBP acknowledges that this final rule, requiring pre-departure
transmission of EEM data, could potentially affect a large number of
small U.S. entities. CBP expects that all rail carrier companies that
engage in exporting goods (which presently totals seven rail carriers)
from the United States in the rail environment and an unknown number of
other trade members (such as USPPIs, FPPIs, NVOCCs, freight forwarders,
CHB, or other third parties with knowledge of export manifest data
elements) at approximately 68 U.S. ports of export will be affected by
this final rule. Under this final rule, outbound carriers will be
responsible for transmitting export manifest transportation data and
empty container data, as specified in the regulatory text.\102\ CBP
notes that of the current seven rail carriers affected by this final
rule, two carriers are Canadian
[[Page 55222]]
companies, and the other five companies are large companies according
to the U.S. Small Business Administration's size standards for small
businesses.\103\ Therefore, CBP does not anticipate that this final
rule will affect any small U.S. entity rail carriers.
---------------------------------------------------------------------------
\102\ CBP notes that this final rule requires that all rail
carriers must participate and this rule does not limit participation
to seven rail carriers. If there are additional rail carriers in the
future, they will all be required to adhere to the regulation.
\103\ CBP compared the five U.S. companies with the given U.S.
Small Business Administration's size standards for small businesses
based on the associated NAICS classification listed in Hoovers
Online Company Reports, available at http://subscriber.hoovers.com/H/home/index.html.
---------------------------------------------------------------------------
The scope of impact on small U.S. entities depends largely on how
many other trade members elect to provide electronic manifest cargo
data directly to CBP as a result of this final rule. This final rule
does not require other trade members to provide electronic manifest
cargo to CBP, and CBP expects that they will only do so if it is
beneficial for their business or company. CBP does not anticipate these
other trade members would participate directly if it resulted in a net
cost and if there is a significant cost to participate, they must also
experience a significant benefit that is at least as large. Therefore,
CBP expects that even if this final rule affects a significant number
of small U.S. entities, such entities will not incur significant net
costs. CBP expects that this final rule will save some businesses time
and money by transitioning from a paper process to a more efficient
electronic process. CBP anticipates that providing rail export data
electronically will generate time savings to those transmitting data to
CBP, when making any corrections to data transmitted electronically,
and will reduce paper and printing costs.
According to CBP's calculations in the regulatory impact analysis
for this final rule, the average annual total costs to trade members
will be around $1.9 million, while the average annual total cost
savings will be around $3.3 million. Additionally, CBP anticipates
there will be approximately 4.2 million data transmissions during the
first year this rule is implemented. Therefore CBP anticipates on
average the total cost per data transmission will be approximately
$0.45 to $0.77, meanwhile the estimated cost savings per data
transmission is around $0.78, resulting in a net savings per data
transmission ($0.33).\104\ CBP does not know how many of these trade
members will choose to transmit this data to CBP or how often, so CBP
is unable to estimate the annual savings to these trade members as a
result of this rule.
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\104\ According to CBP's estimates each year during the
regulatory period total costs to trade members would be $1,906,083,
the total cost savings to trade would be $3,284,740 and the total
expected rail EEM data transmissions each year are expected to be
around 4,279,056. CBP calculated the average cost per rail EEM data
transmission by dividing the total cost by the estimated number of
rail EEM data transmission ($1,906,083/4,279,056 = $0.45) and the
average cost savings per rail EEM data transmission by dividing the
total cost saving by the estimated number of rail EEM data
transmission ($3,284,740/4,279,056 = $0.77).
---------------------------------------------------------------------------
Therefore, CBP certifies that this final rule will not have a
significant economic impact on a substantial number of small U.S.
entities. CBP requested comments from the public during the NPRM on
CBP's certification that this rule will not have a significant economic
impact on a substantial number of small U.S. entities, and CBP did not
receive any specific comments on that certification.
C. Paperwork Reduction Act
An agency may not conduct, or sponsor, and an individual is not
required to respond to a collection of information unless it displays a
valid OMB control number. The collections of information in the current
regulations have already been approved by the Office of Management and
Budget (OMB) in accordance with the Paperwork Reduction Act of 1995 (44
U.S.C. 3507) and assigned OMB control number 1651-0001. This collection
already provides estimated burdens to the public for voluntarily
participating in the Rail EEM Test. CBP anticipates that this final
rule will result in an additional time burden to respondents that will
provide rail EEM directly to CBP. This final rule establishes new
requirements for trade members to provide rail EEM data to CBP prior to
a train departing from a U.S. port of export. CBP notes that prior to
providing EEM data, rail carriers typically incurred time burdens to
provide some export data to CBP that were not originally included on
this information collection or any other information collection as the
data was not a statutory or regulatory requirement. Trade members have
expressed that providing export data to CBP as part of the rail EEM did
provide a reduction in time burden compared to the prior process, but
because the original time burden to provide export data to CBP prior to
rail EEM was not included in this information collection CBP estimates
that the time burden to the public from this final rule will be
insignificant.
As a result of this final rule, CBP estimates that at least all
seven major rail carriers that currently engage in exporting goods out
of the United States in the rail environment will be affected.
Collection 1651-0001 will be revised to reflect the changed burden
hours for requiring trade members to provide rail EEM data to CBP prior
to departure of the train from a U.S. port of export. The new
information collection requirements from this final rule will result in
the following estimated time burdens to the public for the information
collection number 1651-0001 from transmitting rail EEM data to CBP:
Estimated number of respondents annually: 7.
Average responses per respondent: 611,294.
Total responses: 4,279,056.
Estimated time burden per respondent: 5,940 hours.
Total time burden: 41,582 hours.
CBP estimates that this added time burden will increase the cost to
the public by $1,520,797 and adjust the total cost to the public for
this information collection to $542,876,501.
CBP also expects that this new information collection requirement
will result in a decrease in the annual cost to the Federal government
through the automated review of rail EEM data by ATS. CBP officers will
experience a reduced time burden from reviewing only 0.10 percent of
all rail EEM responses provided by the public. This revision to the
total number of responses reviewed by CBP for this information
collection decreased by 10,622 responses resulting in a reduced time
burden of around 885 hours and cost reduction of around $70,645
annually.
D. Privacy
CBP will ensure that all Privacy Act requirements and applicable
DHS privacy policies are adhered to as a result of this
regulation.\105\ CBP has issued a Privacy Impact Assessment (PIA) for
the Automated Commercial Environment (ACE),\106\ which outlines how CBP
ensures compliance with Privacy Act protections and DHS privacy
policies, including DHS's Fair Information Practice Principles (FIPPs).
DHS uses the FIPPs to assess and enhance privacy protections by
analyzing the nature and purpose of the collection of PII to fulfill
DHS's mission and how the Department can best provide privacy
protections in light of these principles. The PIA addresses
[[Page 55223]]
issues such as security, integrity, sharing of data, use limitation and
transparency. The PIA is publicly available at: http://www.dhs.gov/privacy-documents-us-customs-and-border-protection.
---------------------------------------------------------------------------
\105\ See the DHS Privacy Policy web page, available at https://www.dhs.gov/privacy-policy-guidance.
\106\ See U.S. Department of Homeland Security, U.S. Customs and
Border Protection, Privacy Impact Assessment for The Automated
Commercial Environment, DHS/CBP/PIA-003 and all subsequent updates,
available at https://www.dhs.gov/privacy-documents-us-customs-and-border-protection.
---------------------------------------------------------------------------
The Privacy Act of 1974 requires that federal agencies issue a
System of Record Notice (SORN) to provide the public notice regarding
personally identifiable information (PII) collected in a system of
records. SORNs explain how the information is used, retained, and may
be accessed or corrected, and whether certain portions of the system
are subject to Privacy Act exemptions for law enforcement, national
security, or other reasons. CBP issued the DHS/CBP-001 Import
Information Systems (IIS) System of Records and the DHS/CBP-020 Export
Information System (EIS) System of Records, which provide coverage for
these regulations.\107\
---------------------------------------------------------------------------
\107\ See DHS/CBP-001 Import Information System, 81 FR 48826
(July 26, 2016), available at https://www.federalregister.gov/documents/2016/07/26/2016-17596/privacy-act-of-1974-department-of-homeland-security-us-customs-and-border-protection-dhscbp-001; and
DHS/CBP-020 Export Information Systems (EIS), 80 FR 53181 (September
02, 2015), available at https://www.federalregister.gov/documents/2015/09/02/2015-21675/privacy-act-of-1974-department-of-homeland-security-us-customs-and-border-protection-dhscbp-020.
---------------------------------------------------------------------------
E. Unfunded Mandates Reform Act of 1995
This rule will not result in the expenditure by State, local, and
tribal governments, in the aggregate, or by the private sector, of $100
million or more in any one year (adjusted for inflation), and it will
not significantly or uniquely affect small governments. Therefore, no
actions are necessary under the provisions of the Unfunded Mandates
Reform Act of 1995.
F. Congressional Review Act
Before a rule can take effect, 5 U.S.C. 801, the Congressional
Review Act (CRA), requires agencies to submit the rule and a report
indicating whether it is a major rule, to Congress and the Comptroller
General. If a rule is deemed a ``major rule'' by OMB, the CRA generally
provides that the rule may not take effect until at least 60 days
following its publication. 5 U.S.C. 801(a)(3). The Administrator of the
Office of Information and Regulatory Affairs of OMB has determined that
this rule does not meet the criteria for a ``major rule'' in 5 U.S.C.
804(2). This rule will take effect 60 days after publication.
G. National Environmental Policy Act
DHS and its components analyze final actions to determine whether
the National Environmental Policy Act (NEPA), 42 U.S.C. 4321 et seq.,
applies to them and, if so, what degree of analysis is required. DHS
Directive 023-01 Rev. 01 and Instruction Manual 023-01-001-01 Rev. 01
(Instruction Manual) establish the policies and procedures that DHS and
its components use to comply with NEPA, 42 U.S.C. 4321 et seq.
NEPA allows Federal agencies to establish categories of actions
(``categorical exclusions'') that experience has shown do not,
individually or cumulatively, have a significant effect on the human
environment and, therefore, do not require an environmental assessment
(EA) or environmental impact statement (EIS). See 42 U.S.C. 4336(a)(2),
4336e(1). The Instruction Manual, Appendix A lists the DHS Categorical
Exclusions.
Under DHS NEPA implementing procedures, for an action to be
categorically excluded, it must satisfy each of the following three
conditions: (1) The entire action clearly fits within one or more of
the categorical exclusions; (2) the action is not a piece of a larger
action; and (3) no extraordinary circumstances exist that create the
potential for a significant environmental effect. See Instruction
Manual 023-01 at V.B(2)(a)-(c).
DHS has analyzed this action under Directive 023-01 and Instruction
Manual 023-01-001-01. DHS has made a determination that this rulemaking
action is one of a category of actions that do not individually or
cumulatively have a significant effect on the human environment. First,
this rule clearly fits within the Categorical Exclusions A3(a) and
A3(d) of DHS's Instruction Manual 023-01-001-01, Appendix A, for the
promulgation of rules of a ``strictly administrative or procedural
nature'' and rules that ``interpret or amend an existing regulation
without changing its environmental effect,'' respectively. Second, this
rule is not part of a larger action. Third, this rule presents no
extraordinary circumstances creating the potential for significant
environmental effects. Therefore, a more detailed NEPA review is not
necessary.
H. International Trade Impact Assessment
The Trade Agreements Act of 1979, 19 U.S.C. 2501-82, prohibits
Federal agencies from establishing any standards or engaging in related
activities that create unnecessary obstacles to the foreign commerce of
the United States. See 19 U.S.C. 2532. Legitimate domestic objectives,
such as essential security and legitimate safety interests, are
exempted from classification as an unnecessary obstacle to foreign
trade. See 19 U.S.C. 2531(b). The Act also requires consideration of
international standards and, where appropriate, that the standards
constitute the basis for U.S. standards. See 19 U.S.C. 2532(2)(A).
Earlier in this preamble, DHS summarized and responded to a comment
suggesting that DHS align with certain international standards,
particularly those related to the use of the commenter's suggested
identifiers for tracking and identifying cargo. As DHS explained above,
CBP's use of the Automated Commercial Environment (ACE) as the platform
for the electronic export manifest and specific data elements which are
internationally recognized meets the standards being utilized by other
trade systems.
The publication of this rule serves legitimate domestic objectives,
such as the safety and security of rail cargo; thus, this rule is
exempt from classification as an unnecessary obstacle to foreign trade.
However, CBP assessed the potential effects of this rule and determined
that it will not create unnecessary obstacles to the foreign commerce
of the United States. CBP conducted a lengthy Test period prior to the
development of this rule, including significant engagement with Test
participants.
VIII. Signing Authority
The signing authority for these amendments falls under 19 CFR
0.2(a). Accordingly, this document is signed by the Secretary of
Homeland Security (or the Secretary's delegate).
List of Subjects
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, Exports, Freight, Laboratories, Reporting and
recordkeeping requirements, Surety bonds.
19 CFR Part 123
Canada, Customs duties and inspection, Freight, International
boundaries, Mexico, Motor carriers, Railroads, Reporting and
recordkeeping requirements, Vessels.
[[Page 55224]]
19 CFR Part 192
Aircraft, Exports, Motor vehicles, Penalties, Reporting and
recordkeeping requirements, Vessels.
Amendments to the Regulations
For the reasons stated in the preamble, parts 103, 113, 123, and
192 of title 19, Code of Federal Regulations (19 CFR parts 103, 113,
123, and 192), are amended as set forth below.
PART 103--AVAILABILITY OF INFORMATION
0
1. The general authority citation for part 103 and the specific
authority citation for Sec. 103.31a continue 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, 6 U.S.C.
943, 19 U.S.C. 1415, and 49 U.S.C. 44901 note;
* * * * *
0
2. Amend Sec. 103.31a by revising and republishing paragraph (a) to
read as follows:
Sec. 103.31a Advance electronic information for air, truck, and rail
cargo; Importer Security Filing information for vessel cargo.
* * * * *
(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, Sec. 122.48b, Sec.
123.91, Sec. 123.92, Sec. 123.93, or Sec. 192.14 of this chapter;
* * * * *
PART 113--CBP BONDS
0
3. The general authority citation for part 113 continues to read as
follows:
Authority: 19 U.S.C. 66, 1623, 1624.
* * * * *
0
4. Amend Sec. 113.62 by adding paragraph (k)(3) and revising and
republishing paragraph (n)(1) to read as follows:
Sec. 113.62 Basic importation and entry bond conditions.
* * * * *
(k) * * *
(3) If the principal elects to provide advance outbound information
to CBP electronically, the principal agrees to provide such information
in the manner and in the time period required by regulation. 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.
* * * * *
(n) * * *
(1) If the principal defaults on agreements in this condition other
than conditions in paragraph (a), (g), (i), (j), (k)(2), (k)(3), (l),
or (m) of this section the obligors agree to pay liquidated damages
equal to the value of the merchandise involved in the default, or three
times the value of the merchandise involved in the default if the
merchandise is restricted or prohibited merchandise or alcoholic
beverages, or such other amount as may be authorized by law or
regulation.
* * * * *
0
5. Amend Sec. 113.63 by revising and republishing paragraph (g) to
read as follows:
Sec. 113.63 Basic custodial bond conditions.
* * * * *
(g) Agreement to comply with electronic entry and/or advance cargo
information filing requirements. (1) 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 of $5,000 per violation.
(2) If the principal elects to provide advance outbound information
to CBP electronically, the principal agrees to provide such information
in the manner and in the time period required by regulation. 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.
* * * * *
0
6. Amend Sec. 113.64 by revising and republishing paragraph (d) to
read as follows:
Sec. 113.64 International carrier bond conditions.
* * * * *
(d) Agreement to provide advance cargo information. (1) The
incoming carrier agrees to provide advance cargo information to CBP in
the manner and in the time period required under applicable
regulations. 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.
(2) The outbound carrier agrees to transmit advance outbound
information to CBP electronically, in the manner and in the time period
required by regulation. If the outbound 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 departure.
* * * * *
PART 123--CBP RELATIONS WITH CANADA AND MEXICO
0
7. 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)), 1415, 1431, 1433,
1436, 1448, 1624, 2071 note.
* * * * *
0
8. Revise and republish Sec. 123.0 to read as follows:
Sec. 123.0 Scope.
This part contains special regulations pertaining to Customs
procedures at the Canadian and Mexican borders. Included are provisions
governing report of arrival, manifesting, unlading and lading,
instruments of international traffic, shipments in transit through
Canada or Mexico or through the United States, commercial traveler's
samples transiting the United States or Canada, baggage arriving from
Canada or Mexico including baggage transiting the United States or
Canada or Mexico, and electronic information for rail and truck cargo
in advance of arrival or departure. Aircraft arriving from or departing
for Canada or Mexico are governed by the provisions of part 122 of this
chapter. The arrival of all vessels from, and clearance of all vessels
departing for, Canada or Mexico is governed by the provisions of part 4
of this chapter. Fees for services provided in connection with the
arrival of aircraft, vessels, vehicles and other conveyances from
Canada or Mexico are set forth in Sec. 24.22 of this chapter.
Regulations pertaining to the treatment of goods from Canada or Mexico
under the North American Free Trade Agreement are contained in part 181
of this chapter. The requirements for the United States Postal Service
to transmit advance electronic information for inbound international
mail shipments are set forth in Sec. 145.74 of this chapter.
0
9. Revise the heading of subpart J to read as follows:
Subpart J--Advance Information for Cargo Arriving or Departing by
Rail or Truck
0
10. Add Sec. 123.93 to read as follows:
[[Page 55225]]
Sec. 123.93 Electronic information for rail conveyance and cargo
required in advance of export.
(a) General requirement. Pursuant to section 343(a), Trade Act of
2002, as amended (19 U.S.C. 1415), for any train departing the United
States, U.S. Customs and Border Protection (CBP) must receive
electronically from the rail carrier, or other eligible filer as
specified in paragraph (c) of this section, certain information
concerning the train and cargo, as enumerated in paragraphs (d), (e),
and (f) of this section. CBP must receive this information, known as
outbound electronic rail manifest data, no later than the time frames
prescribed in paragraph (b) of this section. The transmission of the
required data must occur through the Automated Commercial Environment
(ACE) or any other CBP-authorized electronic data interchange system.
The transmission of such electronic export manifest (EEM) data for the
purpose of complying with this section does not constitute customs
business. Any examination referrals must be resolved in accordance with
the provisions and time frames prescribed in paragraph (g) of this
section. Any Do-Not-Load (DNL) or Hold instructions must be addressed
in accordance with the provisions prescribed in paragraph (h) of this
section.
(b) Time frame for transmitting data--(1) Initial filing. The
required initial filing data enumerated in paragraph (d) of this
section must be transmitted as early as practicable, but no later than
24 hours prior to departure of the train from the United States port of
export.
(2) Subsequent filing. The required subsequent filing will include
the data identified in paragraphs (b)(2)(i) through (iii) of this
section:
(i) Export manifest cargo data. Export manifest cargo data other
than initial filing data must be transmitted no later than two hours
prior to departure of the train from the United States port of export.
(ii) Export manifest transportation data. Export manifest
transportation data other than initial filing data must be transmitted
no later than two hours prior to departure of the train from the United
States port of export.
(iii) Empty container data. Data related to empty containers must
be transmitted no later than the time of assembly of the train.
(3) Updates. The party who transmits data must update it if, after
the filing is transmitted, any of the transmitted data changes or more
accurate data becomes available. Updates are required upon discovery of
data changes.
(c) Parties filing cargo and conveyance data--(1) Outbound carrier.
The outbound carrier is responsible for transmitting export manifest
transportation data and empty container data. If no other eligible
party elects to transmit the initial filing data or export manifest
cargo data, the outbound carrier must transmit it. If another eligible
party elects to transmit either the initial filing data or export
manifest cargo data, the outbound carrier may also choose to do so.
(2) Other filers. In addition to the outbound carrier for whom
participation is mandatory, one of the following parties meeting the
qualifications of paragraph (a) of this section that require
transmission of information through ACE or any other CBP-authorized
electronic data interchange system may elect to transmit to CBP the
initial filing data and/or the export manifest cargo data for outgoing
cargo listed in paragraph (d) of this section.
(i) The U.S. Principal Party in Interest (USPPI), as defined by the
provisions of Sec. 30.1 of the Foreign Trade Regulations (FTR) of the
Department of Commerce, Bureau of the Census (15 CFR 30.1), or its
authorized agent;
(ii) The Foreign Principal Party in Interest (FPPI) or its
authorized agent, as those parties are defined by the provisions of
Sec. 30.1 of the Foreign Trade Regulations (FTR) of the Department of
Commerce, Bureau of the Census, (15 CFR 30.1); or
(iii) Any other party with direct knowledge of the export
information acting as an EEM transmitter, which may include a customs
broker, Automated Broker Interface (ABI) filer, non-vessel operating
common carrier (NVOCC) as defined by Sec. 4.7(b)(3)(ii) of this
chapter, or a freight forwarder as defined in Sec. 112.1 of this
chapter.
(3) Nonparticipation by other party. If another party specified in
paragraph (c)(2) of this section does not transmit advance export
information to CBP, the party that arranges for and/or delivers the
cargo to the outbound carrier must fully disclose and present to the
outbound carrier the cargo information listed in paragraph (d) of this
section. The outbound carrier must transmit this information to CBP in
accordance with this section.
(4) Bond required. A party transmitting any of the information
described in this section must have at least one of the following bonds
on file with CBP: a CBP Basic Importation and Entry Bond containing the
provisions found in Sec. 113.62 of this chapter, a Basic Custodial
Bond containing the provisions found in Sec. 113.63 of this chapter,
or an International Carrier Bond containing the provisions found in
Sec. 113.64 of this chapter.
(5) Required information in possession of third party. Any entity,
other than the outbound carrier or a party described in paragraph
(c)(2) of this section, in possession of data required to be
transmitted to CBP under this section must fully disclose and present
the required data to either the outbound carrier or other electronic
filer, as applicable, which must transmit such data to CBP.
(6) Party receiving information believed to be accurate. Where the
party electronically transmitting the data required in paragraph (d) or
(f) of this section receives any of this information from another
party, CBP will take into consideration how, in accordance with
ordinary commercial practices, the transmitting party acquired such
information, and whether and how the transmitting party is able to
verify this information. Where the transmitting party is not reasonably
able to verify such information, CBP will permit the party to
electronically transmit the information based on what that party
reasonably believes to be true.
(d) Initial filing. The following information comprises the initial
filing which is mandatory and may be made by any party identified in
paragraph (c)(1) or (2) of this section:
(1) Mandatory data. (i) Bill of lading number;
(ii) The numbers and quantities of the cargo laden aboard the train
as contained in the carrier's bill of lading, either master or house,
as applicable (this means the quantity of the lowest external packaging
unit; numbers or quantities of containers and pallets do not constitute
acceptable information; for example, a container holding 10 pallets
with 200 cartons should be described as 200 cartons);
(iii) Total weight of cargo expressed in pounds or kilograms;
(iv) A precise cargo description (or the Harmonized Tariff Schedule
(HTSUS) number(s) to the 6-digit level under which the cargo is
classified if that information is received from the shipper) and weight
of the cargo; or, for a sealed container, the shipper's declared
description and weight of the cargo (generic descriptions, specifically
those such as ``FAK'' (``freight of all kinds''), ``general cargo,''
and ``STC'' (``said to contain'') are not acceptable);
(v) The shipper's complete name and address from the bill(s) of
lading (for each house bill in a consolidated shipment);
(vi) The consignee's complete name and address from the bill(s) of
lading (The consignee is the party to whom the cargo will be delivered
in the foreign country. However, in the case of cargo
[[Page 55226]]
shipped ``to order of [a named party],'' the ``to order'' party must be
named as the consignee; and if there is any other commercial party
listed in the bill of lading for delivery or contact purposes, the
carrier must also report this other commercial party's identity and
contact information including address in the ``Notify party'' field.);
and
(vii) Employer Identification Number (EIN) or Importer Record
Number or CBP assigned number.
(2) Conditional Initial data. The Automated Export System (AES)
Internal Transaction Number (``ITN'') or FTR exemption/exclusion code
is conditional and must be transmitted if, and as soon as, applicable.
(e) Export manifest transportation data--(1) Mandatory data. The
following transportation data is mandatory and must be transmitted by
the rail carrier or its agent:
(i) Port of departure from the United States;
(ii) Date of departure;
(iii) Estimated time of departure;
(iv) Carrier-assigned conveyance name, equipment number and trip
number;
(v) Train Consist, which includes:
(A) Manifest number;
(B) Train number;
(C) Rail car order; and
(D) Empty containers;
(vi) The rail carrier identification SCAC code (the unique Standard
Carrier Alpha Code assigned for each carrier by the National Motor
Freight Traffic Association; see Sec. 4.7a(c)(2)(iii) of this
chapter);
(vii) Container or equipment numbers (for containerized shipments)
or rail car Numbers (for all other shipments); and
(viii) Employer Identification Number (EIN) or Importer Record
Number or CBP assigned number.
(2) Conditional data. The following transportation data is
conditional and must be transmitted by the rail carrier or agent if
applicable:
(i) 6-character Hazmat Code. The UN (for United Nations Number) or
NA (North American Number) and the corresponding 4-digit identification
number assigned to the hazardous material must be provided;
(ii) Marks and numbers; and
(iii) Seal number (only required if container was sealed). The seal
numbers for all seals affixed to containers and/or rail cars to the
extent that CBP's data system can accept this information (for example,
if a container has more than two seals, and only two seal numbers can
be accepted through the system per container, electronic presentation
of two of these seal numbers for the container would be considered as
constituting full compliance with this data element).
(3) Optional data. The following transportation data is optional
and may be transmitted by the rail carrier or its agent:
(i) Mode of transportation (containerized rail cargo or non-
containerized rail cargo);
(ii) Equipment type code; and
(iii) Place where the rail carrier takes possession of the cargo
shipment or empty rail car.
(f) Export manifest cargo data--(1) Mandatory data. The following
export manifest cargo data is mandatory and may be transmitted by any
party eligible to transmit as described in paragraph (c) of this
section. If the information has been provided in the initial filing, it
need not be transmitted again unless there are updates or changes:
(i) Shipper name and address (for empty rail cars, the shipper may
be the railroad from whom the rail carrier received the empty rail car
to transport);
(ii) Consignee name and address (for empty rail cars, the consignee
may be the railroad to whom the rail carrier is transporting the empty
rail car);
(iii) Port of Lading;
(iv) Port of Unlading;
(v) Bill of Lading type (Master, House, Simple or Sub);
(vi) Bill of Lading Numbers (Master, House, Simple or Sub);
(vii) AES Internal Transaction Number or In-bond Number (per
shipment);
(viii) Cargo description;
(ix) Weight of cargo (may be expressed in either pounds or
kilograms);
(x) Quantity of cargo and unit of measure; and
(xi) Employer Identification Number (EIN) or Importer Record Number
or CBP assigned number.
(2) Conditional data. The following export manifest cargo data is
conditional and must be transmitted if applicable:
(i) In-bond type;
(ii) Notify party name and address; and
(iii) Secondary notify party name and address.
(3) Optional data. The following export manifest cargo data is
optional and may be transmitted by any party eligible to transmit as
described in paragraph (c) of this section:
(i) Mexican Pedimento Number (only for shipments for export to
Mexico);
(ii) Secondary notify party Standard Carrier Alpha Code (SCAC);
(iii) Country of ultimate destination; and
(iv) Number of house bills of lading.
(g) Examination referrals--(1) Potential referrals. There are two
types of referrals that may be issued by CBP after a risk assessment of
an outbound export manifest data transmission.
(i) Referral for information. A referral for information will be
issued if a risk assessment of the cargo cannot be conducted due to
non-descriptive, inaccurate, or insufficient data. This can be due to
typographical errors, vague cargo descriptions, and/or unverifiable
information; or
(ii) Referral for screening. A referral for screening will be
issued if the potential risk of the cargo is deemed high enough to
warrant enhanced screening.
(2) Rail export referral resolution. All outbound rail export data
transmitters must respond to and take the necessary action to address
all referrals, no later than prior to departure of the train. The
appropriate protocols and time frame for taking the necessary action to
address these referrals must be followed as directed by CBP. The
parties responsible for taking the necessary action to address outbound
rail export data referrals are as follows:
(i) Referral for information. The data transmitter is responsible
for taking the necessary action to address a referral for information.
The last party to file the outbound rail manifest data for which
referral is sought is responsible for such action.
(ii) Referral for screening. If the outbound rail export manifest
transmitter is the rail carrier, it may address a referral for
screening directly. If the outbound rail export manifest transmitter is
a party other than the outbound rail carrier, it may choose to address
the referral for screening directly while informing the outbound
carrier of the referral. If the outbound rail export manifest
transmitter chooses not to address the referral for screening, it must
notify the outbound rail carrier of the referral for screening. Upon
such notification, the outbound rail carrier is responsible for taking
the necessary action to address the referral.
(3) Prohibition on transporting cargo with unresolved referrals.
The outbound rail carrier may not transport cargo destined for
departure from the United States until all referrals issued pursuant to
this section with respect to such cargo have been resolved.
(h) Do-Not-Load (DNL)/Hold instructions. (1) A Do-Not-Load (DNL)
instruction will be issued to the outbound rail carrier and any other
transmitter as soon as applicable if it is determined that the cargo or
rail car may contain a potential threat to the train and its vicinity.
(2) A Hold instruction will be issued to the outbound rail carrier
and any
[[Page 55227]]
other transmitter as soon as applicable, even after loading, if it is
determined that further examination of the cargo or rail car is
required.
(3) All outbound rail carriers and any other transmitter must
respond and fully cooperate when a Do-Not-Load (DNL) or Hold
instruction is issued. The party with physical possession of the cargo
will be required to carry out the Do-Not-Load (DNL) or Hold protocols
and the directions provided by law enforcement authorities. All
outbound rail carriers and transmitters who receive a DNL or Hold
instruction must contact CBP at the port of export.
(4) The outbound rail carrier may not transport cargo with a Do-
Not-Load (DNL) or Hold instruction.
PART 192--EXPORT CONTROL
0
11. The 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.
0
12. Amend Sec. 192.14 by revising paragraph (b)(1)(iv) to read as
follows:
Sec. 192.14 Electronic information for outward cargo required in
advance of departure.
* * * * *
(b) * * *
(1) * * *
(iv) For rail cargo, the USPPI, the USPPI's authorized agent, or
the FPPI's authorized filing agent must provide the EEI filing citation
(the ITN), exclusion, and/or exemption legend to the exporting carrier
no later than 2 hours prior to the arrival of the train at the border,
except that EEI filing included in an initial data transmission of
electronic export manifest (EEM) information must be filed in
accordance with the provisions of Sec. 123.93 of this chapter;
* * * * *
Markwayne Mullin,
Secretary of Homeland Security.
[FR Doc. 2026-17390 Filed 8-25-26; 8:45 am]
BILLING CODE 9111-14-P