The ACE platform creates advantages and challenges for companies of all sizes – let's review.
After U.S. Customs and Border Protection’s (CBP) new platform ACE (Automated Commercial Environment) becomes fully operational, it will process many important transactions taking place after entry release and entry summary.
CBP intended for the new capabilities to be implemented in full by January of 2017.
While some of these transactions have already been partially deployed, the agency postponed complete implementation until a yet-to-be-determined date.
In preparation for this next phase of ACE deployment, let’s review the advantages and potential challenges for future transactions.
First of all, what are these transactions?
They include post summary corrections (PSC), protest, liquidation, duty drawback and reconciliation.
Let’s take a deeper look at what is happening. Overall, each of these transactions is benefiting from automation.
In general, post summary transactions have been notoriously manual and paper driven. Moving forward, all of these transactions will benefit from some level of automation.
For the broker and trader, it will require the digitizing of some data elements, but in return, the government can more quickly turn around manual evaluations and approvals. And with the data now being collected systematically, it can become integrated into the ACE data mart.
Perhaps the biggest implication downstream is CBP’s ability to track company and industry trends of post summary transactions over the time period (typically five years) when this information will be stored.
For the trader, this provides the opportunity to take advantage of a more regular process in applying one or more of these transactions as part of their normal entry activity. At the same time, it means traders need to remain aware of the importance of providing consistent and accurate information as part of the process.
Let’s take a quick look at some of the highlights from each of these transactions and how ACE is expected to influence them.
Post summary corrections are electronic corrections made through ACE on entry summary data presented to and accepted by CBP. In the old post entry amendment (PEA) days, each PEA had to be manually reviewed by CBP import specialists prior to approval for the trader.
Electronic submission of PSCs, which have been operational for some time now, are an automated process with the transactional information stored in the ACE data mart.
Protest provides a legal vehicle for importers and interested parties to administratively contest CBP decisions related to imported merchandise. It is the only option available after liquidation (up to 180 days).
CBP has been working to transition all electronic filing of protests to ACE. All components of protest submissions can be managed through the ACE Secure Data Portal (the ACE Portal), including: creating protests, amending previously submitted protests and viewing the status of protests that were submitted through the ACE Portal.
An ACE protest filer account needs to be established for filers within the ACE Portal. For electronic protest submissions, Document Imaging System (DIS) will not be used to upload supporting documents.
All supporting documents and files for additional entry numbers must be uploaded in the ACE Portal for electronic submissions to the protest record.
In the end, protests will now enjoy more regularity but with some manual processing performed by CBP. It’s important to note that protests can still be submitted in paper form.
Liquidation is CBP’s process of reviewing an entry and finalizing the agency’s position on duties, among other things. A primary benefit of ACE – and one that was implemented in January of 2017 – is the agency will no longer print the C16 notices (Official Notice of Extension, Suspension and Liquidation) for posting to the liquidation bulletin and instead, the electronic bulletin will provide public notice.
Importers can search the electronic bulletin by filer or date of the event. Postings are kept online for 15 months to allow time to search for a liquidation. In addition, the electronic bulletin will serve as the official notice of any extension or suspension of liquidation for an entry.
Duty drawback is the refund of certain duties, internal revenue taxes and fees collected upon the importation of goods. These refunds require the exportation or destruction of goods under CBP’s supervision.
Under the ACE implementation, an automated process is replacing the existing process requiring drawback claimants to provide zip files on CDs for their drawback claim submissions. Now supporting documents for drawback claims should be submitted to ACE through DIS.
In conjunction with the implementation of ACE, the 2015 Trade Enforcement and Trade Facilitation Act is also requiring changes to the drawback process, which have the effect of simplifying and streamlining drawback.
For example, unused same condition and substitution drawback will require the first eight digits of the Harmonized Tariff code to match between imported goods and re-exported goods. This in turn allows the trader to reconcile and claim drawback on goods under a much clearer standard.
Reconciliation allows an importer, using reasonable care, to make entry of goods without all the necessary elements to calculate duties. At a later date, after the specific information is determined, the importer then files a reconciliation entry with the final and correct information. Often, reconciliation concerns declared value.
According to CBP, the reconciliation process, while open to everyone, has been limited by requiring a company to submit an initial paper application for the program.
Another major benefit from the ACE transition is that any importer, with a reconciliation bond, may participate in the reconciliation process (while following all of the other reconciliation rules). For the importer who only occasionally needs reconciliation, this becomes a new opportunity to add it to their toolkit.
In summary, as post summary transactions provide one of the final chapters to full ACE implementation, it’s evident that ACE’s structure and capabilities provide added benefits for businesses of all sizes.
The prudent trader should consider taking advantage of some of these improvements while providing timely and accurate information to support the enhancements.
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