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Flexport: CBP Is Checking False Consignee Addresses, Rejecting Vague Descriptors

False consignee addresses and vague descriptions of products are beginning to be flagged by CBP, as the agency tries to wrap its arms around the flood de minimis packages -- and CBP's insistence on better labeling is spreading to other modes of entry as well, Flexport customs experts said.

In a recent webinar on how to have a compliant Entry Type 86 program, Marcus Eeman, senior global customs manager at Flexport, said, in theory, CBP always had rules about proper descriptions for items. "Now, we're seeing rejections of entries" over vague descriptions, he said -- even among formal entries.

They shared a link CBP has shared of acceptable and unacceptable descriptions, but said it's better to be more precise than even the 'acceptable' list, which has examples such as "women's dresses" and "shoes."

Eeman said when importers put "polyester woven dress" on a package rather than "women's dress," they see more positive results.

Tom Gould, vice president of global customs and trade at Flexport, said he was discussing the issue with a CBP executive tackling the issue, and learned that CBP is working on software that can scan for words that often are used in too-vague descriptions, as well as variants of those words. He said CBP is often seeing "samples," a product number with no description, and "wearing apparel" on forms.

According to an informal poll of those listening to the webinar, about 35% currently file Type 86 entries, 32% are considering filing those entries, and 3% stopped filing them. For those who don't file them, 9% said it didn't fit the business model, 9% said they were concerned about CBP enforcement, and 70% felt they need to know more about the process.

One of the questions at the end of the webinar revealed some importers are still not sure who Type 86 is for. While it began as a way for importers to get electronic clearance of de minimis packages that have partner government agency reporting requirements, it has spread far beyond that segment because those entries clear much faster than traditional Section 321 de minimis entries.

Gould explained that if you bring a package in without using a data pilot, the process for clearing the shipments varies from port to port. At some ports, you can mail a spreadsheet of the bills of lading; at others, they have their own electronic form; and at others, you have to print out a bill of lading and courier it to the port officials.

These processes add three to four days to the time to clear, compared to Type 86, he said.

Under Type 86, year to date, with the most recent data available, there have been 474.7 million Type 86 entries, and 161.5 million entries through the Section 321 pilot, which also uses advance data.

Eeman asked Gould what compliance managers should be concerned about, and Gould replied that CBP continues to become more sophisticated, and has higher expectations for brokers' oversight. Gould said there could be a shipment you have cleared repeatedly across the last year" and today, all of a sudden, customs puts a stop to it."

Gould said brokers should be able to check the names of consignees and their addresses, and make sure that they don't have multiple shipments that add up to more than $800 from different sellers. They should also communicate to their customers that they want to know if the seller believes their project is subject to a partner government agency requirement. But, he said, brokers also should be looking at HTS numbers and seeing if any have a flag for a PGA.

Eeman said there are goods you might think of -- such as sunglasses, bug spray -- and there are some products that cannot be cleared under Type 86, because they need Fish and Wildlife Service inspection. That would be items with fur, feathers, shells or exotic leather.

Another example of CBP's growing scrutiny of de minimis, Gould said, was something he learned from a CBP speaker this week at a conference. That speaker said that CBP just started evaluating consignee addresses, because they realized some contraband has an address that doesn't exist.

"That shows you how aggressive Customs is being in trying to stop illicit trade," Gould said. "I'm going back and talking to our technical teams and saying we need to start looking at the addresses and making sure they're real addresses and if they're not, we need to block them."

While the frequency of exams is low among Type 86 entries, Gould warned, "Remember, things are changing. We're going to see new requirements. Customs is getting more resources. We're going to be seeing more exams. Don't expect the same patterns we're seeing today to continue."