LLUSCBA E-Briefing This communication service provided by the Laredo Licensed U.S. Customs Brokers

RESULTS FROM CUSTOMS MONTHLY MEETING ON 04/7/2010
On Wednesday 4/07, U.S. Customs, USDA, FDA and the local trade participated in our monthly Customs Meeting to address issues that affect the local industry. During this meeting, CBP elaborated and clarified Customs position on the trade bulletin Notice 10-003 that explains the procedure on the use of the CF3499 (Blue letter), which changes the procedures on manipulation of In-Bond Merchandise. The trade notice simply states that all requests to manipulate bonded merchandise must have the approval of the Port Director and must be completed in accordance with the trade notice guidelines. Please refer to Laredo Trade Bulletin Notice 10-003. The entry team also presented training on preparing the Power of Attorney. Please see minutes for additional discussions. Minutes are also posted on the members section of the website. www.lluscba.org

MEETING WITH LDF & CITY ON COLD STORAGE DOCK AT WTB AND COLUMBIA 04/8/2010
On April 8th Rodolfo Delgado, Victor Gonzalez & Jose Gonzalez met with Assistant Port Director Mr. Joe Uribe, the Laredo City Managers, LDF officials, and other interested parties to discuss a proposed study on construction of a cold storage facility at both commercial ports of entry. This project is currently in preliminary talks but the city manager has requested information on fee structures and proposed this project to City Council, which further commits this project.

MEETING WITH APHIS ON 04/9/2010
On April 9th 2010, the LLUSCBA APHIS Committee hosted a meeting with representatives from ALFA, City Manager Carlos Villarreal, Representation from Congressman Henry Cuellar, Darya Chehrezad Senior Attaché for USDA Mexico City and Mark L Davidson Associate Director Veterinary Services to address issues regarding safety concerns for Veterinary Inspection Services at the port of Laredo when importing live animals. Inspections by the Veterinary Services were halted for safety concerns after an incident that occurred in Nuevo Laredo. During the discussion, Laredo stakeholders conveyed the message that the disruption of these services affected the local economy. The recommendations proposed to expedite services at the port are:

Short-term recommendations with immediate impact
1. The City was committed to work with the Veterinary Services to allow crossing at World Trade bride to create a shorter distance of travel for the inspectors.
2. The City of Nuevo Laredo offered to provide Industrial Police Escort to ensure the safety of the Inspectors to and from the livestock pens.

Long-term recommendations
1. Get a local veterinarian staffed in Laredo to fill the open spot available.
2. See if the Inspection Pens in Mexico can be moved closer to the customs area.

NCBFAA’s 36th Annual Conference, 04/11-14/2010
On April 11th -14th there were over 25 LLUSCBA members who attended the NCBFAA 36th annual conference in San Antonio, TX. Key topics presented below are from notes presented by Joe Trulik from Fedex Trade Network in the northern border.

FDA Penalties – In a public PowerPoint presentation, FDA gave notice that it would work with CBP to assess Broker penalties for repetitive violations. At issue was whether FDA violations could be addressed under the CBP 1641 provisions which historically involved violations of “Customs Business”. There were two trains of thought: 1) FDA issues are NOT customs business and 2) This activity could be deemed customs business as FDA shipments are transaction specific and a condition of release. This issue does need to be explored in greater detail as FDA lacks uniformity practices at the district levels, has no binding ruling program (and therefore so many things are subject to interpretation), has not put out a true ‘informed compliance’ program similar to CBP, and Brokers generally act as filers of the FDA data.

Draft RLF Guidelines/Handbook – CBP has issued a draft Handbook on the RLF process and did solicit feedback from the NCBFAA on this new publication. It was agreed that the new Handbook is quite comprehensive and we are most appreciative of the steps taken by CBP to put it together. There was a request to approach CBP to issue an electronic version with hyperlinks to the supporting documents referenced in the Handbook.

1641 Penalties/Sanctions – The feeling of the Committee is that the current 1641 guidelines are still sound and we see no need for any drastic changes. The key has been if CBP is enforcing it properly following the progressive enforcement guidelines as laid out in their own Broker Handbook. Discussion still needs to occur with CBP to get a consensus and agreement on what we believe should be the best approach. It cannot and should not be the erratic practices that are seen today, but rather the defined and refined guidelines as spelled out in the Broker Handbook.
There have been two cases working through the courts involving 1641 penalties (the UPS and Lizaraga cases). In the UPS case (CBP issued multiple penalties for the same issue/occurrence), the court sided with UPS and the NCBFAA (who filed an amicus brief). The court, for the most part, ruled that CBP did not follow the published procedures. As for the Lizaraga case, the court indicated that the filer code is akin to ‘property’ and therefore, ‘due process’ must be observed rather than any arbitrary and unilateral attempt to suspend a filer code. CBP is appealing both cases and at the Board meeting during the conference, a motion passed to commit an additional $15,000 for an ‘amicus’ filing by NCBFAA Legal Counsel given the appeal by CBP of the court decision involving the Lizaraga case. The hope was and continues to be that CBP will reach out to the brokerage community. However, this may be currently tempered given that these cases are still active and Customs may not be able to have any dialogue until these cases are resolved
.
Recordkeeping NPRM – We encourage our members to read the NPRM on this issue very closely as there are specific requirements and Customs suggests that the new requirement may not apply if the Broker is also the Importer. This NPRM allows Brokers to keep their records at a place of their choosing as long as they can produce the documents in a reasonable amount of time. It also allows Brokers to dispose of original documents after they have been transferred to some type of electronic format and storage. This negates the need to keep original documents for 120 days before destroying.

Broker Self Assessment Task Group – Customs is behind schedule in their efforts in this area. It is believed that this assessment is significantly more complicated than first anticipated. Part of the challenge has been to take steps so that Brokers and CBP are speaking the same language. It is also quite likely that Brokers have differing policies and practices in the ‘control’ of their operations. CBP did commit to meeting with representatives of the NCBFAA to apprise them of their progress. However, as CBP is behind schedule, this first update has not occurred.

ISF Subcommittee – Don Woods, who heads up this sub-committee, continues to have dialogue with CBP on this critical industry issue. Things are progressing and it was reported that CBP will be issuing letters to Importers who are not filing an ISF.

ITAR Work Group – This group continues to work with Customs to ensure there is uniformity at both the time of import and export as it relates to shipments subject to ITAR. Customs HQ did remove the requirement to submit the import documentation for ‘paperless releases’ (CF3461 or CF7501) to CBP within 5 days from release to be annotated confirming a valid release occurred. Although this requirement has been removed, the Broker is still required to contemporaneously annotate the CF3461 or CF7501 with the ITAR exemption statement and maintain it for recordkeeping purposes. Upon export, Customs has the right to ask for a copy of the import documents (with the statement). It is also important that the AES reporting is both timely and accurate.

DC Counsel Representative – Jon Kent reported that there was a meeting with the new Commissioner of Customs and there appeared to be a genuine interest in Trade Facilitation. Meanwhile, the Customs Reauthorization Bill seems to be languishing and Jon was not optimistic that passage would occur this year. He commented that this session of Congress has not been very good at passing what could be considered “routine” legislation.

Customs Counsel – Alan Klestadt reported that a wide range of issues continue to play out on what he characterized as a “diverse playing field”. The NCBFAA should be proud of its efforts to work with CBP on ACE. We believe our Association is being recognized as the leader in this arena. We need to be vigilant and active in so many areas, as there are certain to be speed bumps along the way. We need to get acquainted with the new Commissioner and to develop long term strategic plans.

Delivery Orders - The members expressed their concerns about being required by the carriers to issue Delivery Orders, when the members were acting as customs brokers on “carrier door delivery moves.” This concern arises out of several recent litigated cases involving claims made by injured plaintiffs against property brokers, the latter of which are normally not liable for injuries sustained either to cargo or to individuals due to the negligence of the truckers they have utilized.
As issuing a Delivery Order at least on carrier door moves is not a normal part of the undertaking of a customs broker, and as there is concern that issuing any document that could be misinterpreted by an injured plaintiff could result in liability, the Association has been discussing this issue with the various carriers in an attempt to have the carriers agree to no longer require that brokers issue such delivery orders at the risk of otherwise subjecting other customers to demurrage claims. Both the Carrier Best Practices Committee in their meetings with the carriers have been unsuccessful, as has General Counsel Greenberg in his discussions with Chris Koch of the World Shipping Council.
Accordingly, as the members of the committees regard the carrier insistence on brokers issuing Delivery Orders as an unfair trade practice, and consistent with the previous vote of the NCBFAA Board, General Counsel Greenberg was directed to file a petition seeking a Declaratory Order that this practice was an unjust and unreasonable practice. Before doing so, General Counsel Greenberg was also instructed to contact the FMC’s Acting General Counsel to see if she might be willing to issue an informal opinion on this issue and avoid having to file a formal petition.

Carrier Bills Of Landing - The members of the committees expressed frustration with the fact that many carriers are now establishing increasing fees for issuing bills of lading. This seems particularly troublesome given the fact that the information necessary to print out the bills are provided by the shippers, forwarders and NVOCCs, so that the actual issuance of such a document entails little or no cost to the carriers. It is also unclear whether the carriers can properly do this, in light of the fact that they are required by law to issue bills of lading on request, pursuant to the provisions of COGSA and the Federal Bills of Lading Act.

Southern Border Security Issues – (Cargo Versus Mexican Drug Cartels) The Mexican drug cartels have become what we know as the mafia of the U.S. liquor prohibition days. While most Cartels primary business is still drug smuggling, they now have moved into other areas; extortion, kidnappings, theft, etc. We recommend insuring shipments or have a certificate of insurance from the Mexican carrier to cover the value of goods to be transported. If high value and critical goods, we recommend a security escort. We encourage plants in Mexico to participate in C-TPAT along with using a C-TPAT Mexican carrier.
China 172 Decree & Europe Advance Manifest Proposal - China 172 Decree (program similar to the U.S. 24 hour advance manifest rule) is in effect and Carriers have been transmitting data since the beginning of 2010. It is still in non-enforcement mode and carriers are not sure when full enforcement will be required. The data elements that are required are the basic shipping instructions. China will require the data 72 hours prior to sailing. When it gets to enforcement the cutoffs for receiving container and export data may be moved up a day for U.S. export to China. There are FROB requirements in this program. Europe is working on its own proposal for advance manifest data that we should watch for.

NCBFAA Tariff Exemption Status – Our petition is still under review. The NPRM should be out later this week and we will need as many companies as possible to file supporting comments. Once the NPRM is issued NCBFAA will be distributing an outline to assist with the comment filing.

LAREDO INTERNATIONAL SISTER CITIES FESTIVAL & EXPOSITION 2010 04/23/2010
On April 23rd Victor Gonzalez & Jose Gonzalez met with several attendees of the Sister Cities Festival & Expositions. At this event they explained basic entry processing of importing merchandise into the US and recommended the services of members of the Laredo Licensed US Brokers Association. The LLUSCBA website was given to all attendees as reference.

LLUSCBA WEBSITE ENHANCED TO INCLUDE LISTING OF BONDED WAREHOUSES
The Membership Directory on the LLUSCBA Website has been enhanced to include a listing of Bonded Warehouses. The purpose of this listing is to promote and facilitate the search of Bonded Warehouses to anyone in search of Bonded warehouse services. This listing will consist of active LLUSCBA Members ONLY who possesses an authorized facility recognized by U.S. Customs and Border Protection.
To participate in this listing, follow the instructions below or contact Margie Treviño for assistance.

Instructions for Bonded Warehouse Listing
www.lluscba.org
1. Under Members Login enter your user name and password
2. In Members Options (on right hand side) click on My Profile
3. Click on Edit/ Update Profile
4. Check box Bonded Warehouse at the bottom of the page
5. Enter Warehouse Square Feet on space provided
6. Click Update

MEETING WITH COMMISSIONER OF CUSTOMS ALAN BERSIN ON 04/29/2010
On Thursday 4/29, Jose D. Gonzalez along with several city and business leaders met with newly appointed U.S. Customs and Border Protection (CBP) Commissioner Alan Bersin who hosted a public forum to discuss CBP’s new vision for improving the secure flow of legal goods and people through our ports of entry. During the forum, attendees asked specific questions on security, on CBP’s management of the flow of people and goods based on risk, and the agency’s commitment to working more closely with the local trade, business, and law enforcement community.

USING A POWER OF ATTORNEY 3RD EDITION BOOKS FOR SALE BY LLUSCBA
We encourage LLUSCBA members to acquire your copy of a practical, legal & regulatory guide for using a power of attorney by Custom Brokers. This book is recommended to have as expert guidance to ensure complete Broker compliance with U.S. statutes and regulations. It is now on sale now for $85.00 to members; please contact Margie Treviño to purchase your copy.

CALENDAR OF EVENTS
FDA Seminar at Laredo Community College, May 11, 2010 Customs Meeting at Laredo Community College, May 12, 20010 LLUSCBA Board Meeting at the Laredo Chamber of Commerce, May 19th 2010 9:00 AM Texas Brokers Annual Conference, October 7th–11th, hosted at the Embassy Suites Laredo, Texas.

SUGESTIONS AND OPINIONS
This briefing is presented to inform the LLUSCBA Members of the involvement of the Association’s Board and Committee Members.
This administration would like to keep its members updated on the outcome of meetings and changes that could affect the industry.
We can only succeed as an effective association with complete cooperation from all members and affiliate members.
We will openly accept any recommendation and suggestion in order to successfully complete our mission as a united voice.

If you know a fellow colleague that is not currently a member, please try to enlist him/her in order to create a stronger voice.