US Customs Overhauling “The Role of the Broker”

US Customs and Border Protection (CBP) has been working to completely revamp its regulations governing licensed customs brokers.

CBP has scheduled a series of summer webinars designed to describe the issues and the agency’s goals and to generate feedback from the trade community before it publishes a first draft of proposed new regulations for formal comment. Participation in this process will be critical for any broker who wishes to have a voice in shaping the future of the broker profession. For any importer that relies on a broker as part of an import compliance strategy – which applies to almost all commercial importers – each company should consider whether its past experiences or present concerns warrant making any comments in the process. In any case, CBP’s process serves as a useful reminder for importers to review whether they are properly instructing and managing brokers, since any error in the import declaration, no matter how it occurs, creates CBP enforcement risk for the importer and not necessarily for the broker.

In January 2011, CBP kicked off the Role of the Broker – Regulatory Revision Workgroup, together with the National Customs Brokers and Forwarders Association of America. CBP has described the Role of the Broker initiative as an effort to develop solutions to the challenges of 21st Century commerce, to leverage broker relationships and extend opportunities for small and medium businesses, and to encourage the spread of best practices in the industry. Central to the Role of the Broker initiative, CBP has announced its intention to completely overhaul 19 CFR Part 111, the regulations governing brokers. Any broker covered by 19 CFR Part 111, whether an individual license holder, a broker in a brokerage house, or an in-house broker for an importing company, will be impacted by the planned overhaul of Part 111. Since licensed customs brokers are the conduit through which most importers make their import declarations to CBP, these changes also will necessarily impact importers.

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Ontario-headquartered Descartes Systems Group has made what it terms “significant extensions” to the company’s cloud-based Logistics Flow Control solution. Descartes claim the new modules provide retailers with better coordination of supplier managed freight shipments and synchronize commercial and logistics documentation required for accurate import Customs duty filings.

Descartes Load Flow Control manages supplier controlled freight by providing the retailer, plus its suppliers and carriers, with purchase order visibility and consolidation that is synchronized with the retailer’s available dock appointment times. The traditional coordination process from supplier to carrier to retailer is streamlined, as the dock appointment is confirmed at the time of purchase order consolidation, thereby reducing total delivery time.

Retailers (or wholesalers) have the ability to control what purchase orders get consolidated by the supplier and managing their movement whilst in transit. Changes to the delivery schedule by any party are measured against a date validation guide, helping to ensure that deliveries comply with purchase order commitments, thus avoiding wasted journeys by road haulage operators and possible demurrage and/or extra cargo handling charges.

Logistics Flow Control is part of Descartes’ Logistics Technology Platform and is a multiple party cloud solution which coalesces the various systems from different stakeholders in the supply chain enabling retailers, suppliers, carriers and brokers to use the same solution to manage the “purchase order to warehouse receipt” process which is aimed at improving inventory control while goods are in transit, reducing the times and costs from transport to Customs penalties and to enable end users to quantify supplier and carrier performance.

The system can be used in conjunction with Descartes Import Compliance system which consolidates all relevant information required for Customs formalities by enclosing in an electronic data set. This can contain everything from properly compiled commercial invoice with Harmonized Tariff Schedule (HTS) classification code updates, image document storage and transferral through to approved release notification as required in each individual country.

Descartes technology is utilized by many leading logistics providers and the company is present currently at the 101st National Retail Federation Expo in New York at the Microsoft pavilion.

Disclosure: GHY International employs Descartes’ Imanet ITMR4 platform to manage its transactions with the Canada Border & Security Agency (CBSA).