Permit to manipulate (CF 3499) | Discrepancy Report (CF 5931) | General Order Warehouse | Customs Automated Systems | INFORMAL ENTRIES | APPRAISEMENT ENTRIES | NO ENTRY REQUIRED | IMMEDIATE DELIVERY | C-TPAT
In purpose to protect the revenue of the United States (and for other reasons listed below) CUSTOMS HAS RIGHTS TO EXAMINE ALL MERCHANDISE. No matter if it is formal, informal, transportation in bond etc.
Even luggage of the president of the United States could be checked by U.S. Customs.
Only TWO EXCEPTIONS: Diplomatic language (1) can be inspected by special way by State Department; and Defense armaments (2), which are under control of Defense Department.
Other reasons besides protecting the revenue of the United States:
- Protection against terrorism (especially since 9/11)
- Quantity and quality verification
- False trade marks
- Marking requirements (goods which are made in China labeled as made in the USA)
- Value (wrong value declared), etc.
Examination can be done at:
- Carrier's facilities
- Special CESs (Centralized Examination Centers authorized by customs for the purpose)
- Importer facilities
- Public storages or warehouses, etc.
CUSTOMS ALMOST ALWAYS INSPECTS MERCHANDISE AFTER ENTRY FORM IS FILED AND SUBMITTED. No matter if it is a formal entry or a passenger's language declaration.
The reason is: CUSTOMS NEEDS SOMETHING SIGNED BY IMPORTER OF RECORDS. I.E. A PROF THAT SOMEONE IS LEGALLY RESPONSIBLE FOR THE ENTRY.
CHARGES FOR THE INSPECTION:
- Inspection at carrier's warehouse usually done for NO CHARGE. However, carrier may charge importers for that.
- If customs comes to importer of record's facility, then IT IS BILLABLE EXPANSES.
- OVERTIME INSPECTION
Means from 5:00pm to 8:00am. If services for which overtime was requested are not preformed through no fault of U.S. Customs, the extra compensation shall be paid for at least one period (2 hours) In addition described in 24.17(a). Examples: Assignment on board to protect the revenue; Supervise unload of vessel or aircraft; Supervise exportation of merchandise; Supervise manipulation outside a bonded area etc.
Normally customs inspects one box out of 10 or 1% of the total invoice.
If customs discovers a shortage the MUST made an official demand for re-delivery goods back to a customs facility WITHIN 30 DAYS from the date of discovery of the shortage. If the demand had not be don within 30 days, then importer of records is not obligated for the re-delivery. Bonded carrier requires to move cargo under bond.
Permit to manipulate(CF 3499)
It allows to open and see it BEFORE customs will inspect it.
It allows VISUALLY look only. You may not take anything. There is going to be customs or carrier's representative next to you.
Permit to manipulate is issued by customs, signed by customs and carrier (since goods is still in carrier possession).
Discrepancy Report (CF 5931. part 158)
If manifest quantity does not match the actual quantity (over or short) CF 5931 must be filed with the entry to explain discrepancy. Examples: Shortage - boxes are coming in different aircrafts of the same airline. Overage - Pallet had been spitted apart).
CF 5931 must be filed at a time of entry. Here are the choices to file:
- To file actual OR manifestual quantity and CF 5931.
- File NET
If an entry is filed, then 5931 and fund that something is missing (or over) CF 5931 SUPPLEMENTAL has to be filed. Later on the balance. However:
1. For entry by air a supplemental must be filed within 30 day from the date of entry.
2. By ocean or surface - within 60 days.
PENALTY: if you fail to file a supplemental on time and you are short, there is fine of $500 + FULL DOMESTIC VALUE OF ALL MERCHANDISE (which is the value + duty).
GOW (General Order Warehouse) 19 CFR Part 127 - "nightmare" for importers of records. In fact it is a bonded public warehouse. The purpose is:
15 calendar days after entry goods are held in carrier's facility.
If you failed to file an entry in 15 calendar days at 5 PM of the 15th calendar day goods will be moved into GOW.
Lien will be putted on the merchandise (CF 3485 - notice of lien).
CHARGES IN GOW ARE EXORBITANT! Brokers lost many customers because goods went to GOW.
The charges are so high because GOW must cover its expenses for abandoned cargo, since auction's sales usually do not cover all expanses of GOW.
Merchandise which is seized by U.S. Customs is also placed in GOW.
Merchandise in GOW can be exported within 6 MONTHS from importation. After the 6 months IT CAN BE ENTERED FOR CONSUMPTION ONLY. It is NOT possible to withdraw from GOW anything less then entire lot.
IF MERCHANDISE IS NOT WITHDRAWN FROM GOW WITHIN 6 MONTH IT WILL BE SOLD AT PUBLIC AUCTION. If the sale does not generate enough founds to pay for GOW storage costs, U.S. Customs can make a claim against the owner for the cost not covered by the sale. This, however, rarely done.
Customs Automated Systems (141.31):
Purposes of automated systems: 1. Clear ports faster; 2. Clear customs paperwork faster; and 3. Clear goods faster for sall in the USA.
ACS - Automated Commercial System, which is included the following parts:
- ABI - Automated Broker Interface. Entries processing.
- AMS - Automated Manifest System.
Before goods arrive to the USA carriers file manifests to U.S. Customs. (Examples: Vessels - what is on the ship; Aircrafts - when wheels go up at origin manifest is submitted electronically).
- ESS - Electronic Selectivity System. Target sensitive goods coming in U.S.; identify customers on certain goods from certain countries. It puts "flag" on sensitive import for examination.
ESS has 3 levels of security based on commodity, carrier's and importer of records history:
1. High risk - frequent exam. Almost every shipment will be exanimate extensively.
2. Unfamiliar - one of three four shipments (containers).
3. Regular - Random. Once in one-two month.
- ACH - Automated Clearing House.
Customs deducts duties and taxes directly from importer's bank accounts. No check writing.
- BARCODING - For Mexico and Canada.
INFORMAL ENTRIES CFR 19.143
Informal entries require NO BOND. However Port Director CAN demand bond on an informal entry. If informal entry is dutiable, then upon the payment of duty it is liquidated in spot.
CF 368 is INFORMAL ENTRY FORM
Types of informal entries (Informal entry apply to) :
1. PERSONAL GOODS REGARDLESS OF VALUE
- Dangerous goods
- If it contains over $250 of certain merchandise. The amount is frozen since 1930 by U.S. Union for U.S. Union protection. (Examples: gloves, shoos, textile, matrices etc. This items are covered in Sections 7,8,11,12 of Harmonize tariffs. Many of those items are subject to visa or quota).
2. American Goods Return (AGR). CF 3311 - Declaration of American Goods Return.
- AGR Under $2,000 (except 250 group)
- AGR under $10,000 returned for repair and to be exported from the USA.
- AGR under $10,000 rejected by foreign buyer. Require CF 3311 AND CF 7501. However it is still informal entry. No bond require and no duty on it.
All entries over $10,000 must be done as FORMAL entries.
Can be informal and formal. However 99% of appraisement entries are formal.
Appraisement entry means that value is unknown. In CF 7501 leave value blank. Customs will determine the value of goods. (Examples: Goods damaged on the rout; gift items; used and second hand goods; dock overage; household goods used abroad and coming back to the USA; personal goods of citizen of the USA who died abroad etc.)
U.S. Customs gives rights to discuss appraisement value if importer think that goods are overvalued.
NO ENTRY REQUIRED. 3.21 of Tariff act 1930
- Everything under $25;
- Intangibles - corps with casket and flowers;
- Currency worth under $10,000 U.S. Dollars (must be reported to IRS, but not to U.S. Customs);
- Telecommunication transmitions;
- Articles from space;
- Business records, diagrams, blue prints etc;
- Articles returned in 45 days, which had not been delivered by carriers (for undelivered articles by USPS, FedEx etc.);
- U.S. aircrafts parts removed for return in 45 days.
- Perishable. NO MATTER WHERE IT COMES FROM;
- U.S. Government;
- Coming from contiguous countries (Canada and Mexico)
Application for Immediate Delivery is CF 3461 (142.21). It is actually entry itself. Difference at 7501 is Customs release it immediately (still in 15 calendars days. However it needs to be much faster for perishables.). IT STILL REQUIRE BOND.
C-TPAT. Newly Introduced Customs Program
Customs & Trade Partnership Against Terrorism
This is a US border security program to help protect the USA from terrorism. C- TPAT combines the efforts of Customs and other government agencies along with importers to develop, strengthen and maintain security controls for the entire global supply chain of goods entering the United States.
This partnership with C- TPAT is voluntary but non-participants have been experiencing numerous CF28 Request for Information regarding their shipment causing a delay with their import process.
C- TPAT consists of various measures depending on the activity of the partnered trade member such as: C- TPAT for importers, licensed brokers, air carriers, sea carriers, rail carriers, air freight consolidators, NVOCCs, marine port authorities and terminal operators. Warehouse and manufacturer security recommendations are provided by Customs in this partnership program. By combining the efforts of all of the trade parties noted above, cargo security from point of origin (the manufacturer) to the ultimate purchaser and consumer would be safe guarded from terrorism.