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Self-Filers Seem to Avoid Onerous Requirements in Importer ID Proposal, NCBFAA Says

The proposed minimum information requirements for broker verification of importer clients includes some onerous provisions that could reduce the use of customs brokers, the National Customs Brokers & Forwarders Association of America said in comments to CBP on the proposal (see 1908130031). The proposal seems to let self-filers avoid the verification requirements, which seems likely to promote the use of self-filing by the parties that are being targeted by CBP, the group said. Comments on the proposal are due Oct. 15.

The NCBFAA highlights two proposed data fields that brokers could be required to collect as being overly burdensome and likely exceeding the Trade Facilitation and Trade Enforcement Act mandate. Those fields, which would be required at the time a Power of Attorney is obtained, are the "grantor's date of birth" and "a copy of the grantor's unexpired government-issued photo identification." While the NCBFAA supports the agency's efforts to stop bad actors, "it is unreasonable to expect that an employee will be willing to provide the broker with his/her personal information so that the company they work for can satisfy the regulatory requirement," the association said. "This requirement is likely to discourage importers from engaging the services of a licensed customs broker and is likely to lead to an increase in the number of importers seeking to become self-filers" rather provide the information.

Under such a requirement, "whereas an importer that works with a broker will be vetted before merchandise is presented for entry into the United States, under the proposed rule, self-filers are not subject to any screening or vetting process and as such, represent a greater compliance/security risk to CBP," the NCBFAA said. "This should not be the result that CBP is seeking to achieve."

CBP also seems to be returning to a POA certification requirement that the agency eliminated 15 years ago, the trade group said. "This is an unnecessary administrative burden which causes delays and adds complexity to the POA process," it said. "It is well established that only company officers and company officials with apparent authority to bind the company can sign the POA." Also unclear in the proposal is how brokers should respond if they do identify a "shell" company and how to differentiate between new or small importers and shell companies that similarly would not have "extensive business operations," the NCBFAA said.

The association also questioned the need for collecting the data elements on existing clients. "These clients have already been established as importers of record with surety bonds and CF 5106 data on file with CBP," the group said. If CBP decides to require the verification for existing clients, the agency should limit "active" clients to "clients for which the broker has transacted customs business within the past 12 months." The NCBFAA also sees the required annual collection of the verification information as unnecessary.

Although not mentioned in the proposal, CBP should exempt some parties from the verification requirements, the NCBFAA said. "We believe that it would be appropriate to waive the data collection requirements for importers that are [Customs-Trade Partnership Against Terrorism] certified, members of the Importer Self Assessment or similar trusted trader programs and importers that have been the subject of a review by regulatory audit within the past year," it said. "These parties have been vetted and validated by CBP and there is nothing to be gained by requiring the broker."