06-529. Automated Commercial Environment (ACE): National Customs Automation Program Test of Periodic Monthly Payment Statement Process

AGENCY:

Customs and Border Protection; Department of Homeland Security.

ACTION:

General notice.

SUMMARY:

This document announces a modification in the Bureau of Customs and Border Protection's (CBP) National Customs Automation Program (NCAP) test concerning periodic monthly deposit of estimated duties and fees. CBP will no longer require Automated Clearing House (ACH) credit participants to initiate payment earlier than the 15th working day of the month as was required by a Federal Register notice published on August 8, 2005. CBP, however, must receive the settlement for the credit by the 15th working day in order to have the periodic monthly statement marked paid and treated as a timely payment.

DATES:

The changes announced in this Notice are effective immediately.

FOR FURTHER INFORMATION CONTACT:

For questions regarding periodic monthly statement payments: Mr. Michael Maricich via e-mail at [e-mail], or by telephone at [phone].

SUPPLEMENTARY INFORMATION:

Background

On February 4, 2004, the Bureau of Customs and Border Protection (CBP) published a General Notice in the Federal Register (69 FR 5362) announcing the National Customs Automation Program (NCAP) test for Periodic Monthly Payment Statement Process. The test, which is part of CBP's Automated Commercial Environment (ACE), benefits participants by giving them access to operational data through the ACE Secured Data Portal (“ACE Portal”), which provides them the capability to interact electronically with CBP, and by allowing them to deposit estimated duties and fees on a monthly basis based on a Periodic Monthly Statement issued by CBP.

When the test started, only importers were eligible to apply for the test. Eligibility was later expanded to allow brokers to apply if they were specifically designated by an ACE importer.

On September 8, 2004, CBP published a General Notice in the Federal Register (69 FR 54302) which invited customs brokers, regardless of whether they were designated by participating importers to make Periodic Monthly Statement payments on their behalf, to apply to participate in the test. That notice set forth eligibility requirements for both importers and brokers.

On February 1, 2005, CBP published a General Notice in the Federal Register (70 FR 5199) announcing that applicants seeking to establish importer or broker accounts so as to access the ACE Portal, or to participate in any ACE test (including the test for Periodic Monthly Payment Statement Process), are no longer required to provide a statement certifying participation in the Customs Trade Partnership Against Terrorism (C-TPAT).

As provided in the February 4, 2004 General Notice announcing the test, participants in the Periodic Monthly Statement test are required to schedule entries for monthly payment. A Periodic Monthly Statement will list Periodic Daily Statements that have been designated for monthly payment. The Periodic Monthly Statement can be created on a port basis by the importer or broker, as was the case with existing daily statements in the Automated Commercial System (ACS) (ACE is the successor to ACS). The Periodic Monthly Statement can be created on a national basis by an Automated Broker Interface (ABI) filer. If an importer chooses to file the Periodic Monthly Statement on a national basis he must use his filer code and schedule and pay the monthly statements. The Periodic Monthly Statement will be routed under existing CBP procedures. Brokers will only view/receive information that they have filed on an importer's behalf. ACE will not route a Periodic Monthly Statement to a broker through ABI if that statement lists information filed by another broker.

On August 8, 2005, CBP published a General Notice in the Federal Register (70 FR 45736) changing the time period allowed for the periodic monthly deposit of estimated duties and fees from the 15th calendar day to the 15th working day of the month following the month in which the goods are either entered or released. That change was made in order to comply with the provisions of section 2004 of the Miscellaneous Trade and Technical Corrections Act of 2004, Public Law 108-429, which extended the time of deposit of those estimated duties and fees from the 15th calendar day to the 15th working day of the month following the month in which the goods are either entered or released. The document also advised that entries containing Census errors will be eligible to be placed on a Periodic Daily Statement and designated for monthly payment. Finally, the document announced that a participant would be subject to a claim for liquidated damages if the participant removed an entry from a Periodic Daily Statement after expiration of a 10-working-day period after release.

On September 22, 2005, CBP published a General Notice in the Federal Register (70 FR 55623) eliminating the requirement that participants in the Periodic Monthly Statement test provide a bond rider covering the periodic payment of estimated duties and fees. The Notice indicated that nonpayment or untimely payment of estimated duties and fees, however, may result in action by CBP to impose sanctions on the delinquent importer of record or to allow the surety to terminate its basic importation bond. If the bond principal is a participant in the Periodic Monthly Statement test, sureties will now be allowed, under certain conditions, to terminate bonds with 3 business days notice to the bond principal and CBP.

Modification of the Monthly Payment Statement Process

This Notice modifies the payment procedure set forth in the August 8, 2005 Notice (70 FR 45736) by specifically eliminating the requirement that “ACH credit participants must initiate payment no later than the 14th working day of the month.” CBP did not intend to dictate the time in which payment must be initiated. CBP must receive the settlement for the credit by the 15th working day in order to have the periodic monthly statement marked paid and treated as a timely payment.

The August 8, 2005 Notice (70 FR 45736) established monthly payment processing procedures that incorporated the changes regarding the extended time for payment of duties and fees, and the removal of entries from the Periodic Daily Statement after expiration of the 10-working-day period after release.

The process for entries scheduled for monthly payment, as of this date including the modifications made by this Notice, is as follows:

a. As entries are filed with CBP, the importer or its designated broker schedules them for monthly payment;

b. Those entries scheduled for monthly payment will appear on the Preliminary Periodic Daily Statement;

c. The importer or its designated broker processes entry summary presentation transactions for Periodic Daily Statements within 10 working days of the date of entry;

d. After summary information has been filed, the scheduled entries will appear on the Final Periodic Daily Statement;

e. Periodic Daily Statements scheduled for monthly payment will appear on the Preliminary Periodic Monthly Statement; CBP will generate the Preliminary Periodic Monthly Statement on the 11th working day of the month following the month in which the merchandise is either entered or released, whichever comes first, unless the importer or designated broker selects an earlier date;

f. On the 15th working day of the month, for Automated Clearing House (ACH) debit participants, CBP will transmit the debit authorizations for the periodic daily statements to the financial institution and the periodic monthly statement will be marked paid. The Final Periodic Monthly Statement will be generated by CBP and be transmitted to the importer or his designated broker. ACH Debit participants must ensure that the money amount identified on the Preliminary Monthly Statement is, in fact, available in their bank account by the 15th working day of the month.

g. CBP must receive the settlement for the credit by the 15th working day of the month in order to have the periodic monthly statement marked paid and treated as a timely payment. The Final Periodic Monthly Statement will be generated by CBP and be transmitted to the importer or his designated broker.

For both ACH Credit and ACH Debit participants, CBP will generate the Final Periodic Monthly Statement on the night that payment is processed.

Participants should note that if they voluntarily remove an entry from a Periodic Daily Statement before expiration of the 10-working-day period after release, that entry may be placed on another Periodic Daily Statement falling within the same 10-working-day period. If, however, participants remove an entry from a Periodic Daily Statement after expiration of the 10-working-day period after release, the entry may be the subject of a claim for liquidated damages for late payment of estimated duties.

Suspension of Regulations

During the testing of the Periodic Monthly Statement process, CBP is suspending provisions in Parts 24, 141, 142, and 143 of the CBP Regulations (Title 19 Code of Federal Regulations) pertaining to financial, accounting, entry procedures, and deposit of estimated duties and fees. Absent any specified alternate procedure, the current regulations apply. All of the terms of the test and criteria for participation therein, as announced in the previous notices identified above, continue to be applicable unless changed by this notice.

Dated: January 12, 2006.

Jayson P. Ahern,

Assistant Commissioner, Office of Field Operations.