Review the flow of commercial transaction.

Tell the students that a full page copy of flow chart is located behind PowerPoint slides in Handout.

Ask class if they want to import NY Yankee’s Bobble-head dolls? (or any other sports figures - the teams going to the Super Bowl, etc.)

1st step - find someone who can make them - agree on how they will look - Which players will the set include? Will they just be standing or batting or pitching or catching? How they will be packaged - in individual boxes or as a team set? and agree on the price.

This step is generally verbal or done through faxes.

The Purchase Order is a written agreement of the specific quantity to be purchased, what the goods will look like, how much the seller will be paid and what is included in the purchase price - also called “Terms of Sale” (does the price include international transportation, insurance, clearance and duties, U.S. transportation, etc.)

This document or the Contract are generally requested when we are trying to verify what happened during the transaction.

The goods are then manufactured and prepared for shipment. CBP has a database in ACS - SSM File - that contains names addresses and MID’s (Identification Numbers) of all Manufacturers/Shippers. We can query how many times the Manufacturer has imported and on what entries if we need to retrieve the entries for closer scrutiny.

After the goods are ready for shipment they are delivered to the carrier. The carrier is chosen for the most convenient or cost effective method of transportation (truck, train, plane or ship) and will be responsible to transport the merchandise to the U.S. Under the Container Security Initiative (CSI), sea vessels must file a manifest at least 24 hours prior to lading (loading) the goods on the conveyance. CSI started in early 2002 to expand our borders and screen merchandise prior to arrival in the U.S. It puts CBP professionals in foreign ports (16 current ports & 12 pending). We reciprocate with allowing foreign officers to come to the U.S. and examine shipments destined for their country.

The carrier must file a manifest with CBP prior to or at the time of arrival (except for CSI ports - remember the 24 hour rule) The manifest is an inventory of all goods, supplies, cargoes, and persons on board a conveyance or container entering or leaving the U.S. It is basically a summary of several bills of lading (it is a unique number for each shipment). Each shipment aboard the carrier will have its own bill of lading. The Manifest can be on paper or in the computer in the Automated Manifest System (AMS) in ACS. CBP uses AMS and the Automated Targeting System-Narcotics (ATS-N) to review manifests for terrorism and narcotics risks.

The Carrier uses a conveyance to deliver the goods to CBP custody in the U.S. This is referred to as arrival or importation. It is when the sea vessel laden with goods arrives within the port limits with intent to discharge cargo. If arrival is by train, truck or air, it is when the conveyance arrives within the CBP territory.

The Importer or his representative (Customs Broker) must file an “Entry” for the release of the merchandise within 15 calendar days after arrival in the U.S. If this is not done with in the time limit, the merchandise is sent to a General Order (GO) Warehouse and if not claimed it will be auctioned.

CBP maintains a database (SRE file) in ACS containing the names, addresses and importer numbers of Importers and Consignees just like the manufacturer/sellers.

When CBP receives the documentation that is required for release of the merchandise, the information is run through ACS Cargo Selectivity. The System checks the previous history for the Filer, MID, HTS#, Importer and Country of Origin. We do not have the resources to examine every shipment, so we must use Risk Management to determine which to look at closer. We want to look at shipments that are more likely to be non-compliant. Prior to 9/11, we focused on the larger importers, but now the focus has turned to Terrorists, who tend to be smaller, infrequent or one-time importers.

Most entries are designated for General Release and the goods are quickly authorized for delivery. In the Sea and Air environment, if the entry is filed prior to actual arrival, the goods can be released as soon as the vessel arrives. In the Land Border environment, this is generally done at “Primary” or the “Super Booth” and the truck is allowed to go Gate-to-Gate without stopping within the cargo facility.

Some shipments will be examined due to some type of criteria that was input in the system or just as a random sample.

During the exam, the CBPO verifies the merchandise that is described on the paper work is actually in the shipment, that the classification number is correct, that the quantity is correct, that there was not transshipment (country of origin) and assists IS & ES with anything that looks out of the norm.

Based on the results of the examination, the goods are most likely released, some will be detained while the admissibility of the merchandise is determined and if it cannot be entered into the U.S. it will be seized.

Ten working days after release of the merchandise, the importer is responsible to file the Entry Summary (CF-7501) along with the appropriate duties, taxes and fees. The collection of these duties can be with U.S. Currency, Personal Check, Money Order, Cashiers Check, Domestic Traveler’s Check or Electronic Transfer called Automated Clearing House (ACH).

Just like ACS reviewed the data during the Cargo Selectivity, it reviews the data for Entry Summary Selectivity. It is a different database that contains information on entries that need to be reviewed by the Import Specialists. It contains information on classification, valuation, transshipments and other schemes to avoid meeting all the requirements of importation and payment of proper duties. All shipments that were examined by the CBPOs must be reviewed, as well as, a random system generated review. If there is no criteria the entry will By-Pass and be set up to liquidate in 314 days.

Import Specialists may review selected Entry Summaries. Entries are selected based on risk management principles. During this review, the import specialist may change the classification and adjust the amount due. If this review uncovers other issues such as inadmissible merchandise, the importer may be required to return the merchandise for inspection. Other violations such as fraud or Intellectual Property Rights issues are referred to the special agents for investigation.

Entries that are not reviewed by the Import Specialist, are scheduled for liquidation in 314 days. This allows the Import Specialist to retrieve and change the entry if they discover a problem with a future entry or if a review of historical data reveal an anomaly.

Liquidation is the final computation of the duties that are due and indicates that all documents were received, the goods are admissible and everything is in compliance. In reality CBP, as well as, the importer can always challenge the liquidation within certain time frames by filling a Protest or Petition.

Step 1 - We combine the Contract, Purchase Order, Manufacture and a portion of the Transportation involving the delivery of the goods to the conveyance, all into one step, The Supplier Delivers Goods to the Carrier.

Step 2 - Here we combine Manifest and Arrival/ Importation parts into one, Carrier Files the Manifest and Delivers the Goods (to US, into CBP Custody)

Step 3 - This is the Entry/Immediate Delivery step. Importer or his representative Files the Entry. The importer has 15 calendar days after the goods arrived to file the “Entry”.

Step 4 - Here we combine the Cargo Selectivity, Examination, Detention, Seizure and Release pieces into one, CBP Examines and Release Goods.

Step 5 - We will call the Entry Summary + Collection, Importer Files Entry Summary. The Importer has 10 Working days after the release of the goods in which to file the Entry Summary and pay any duty/fees.

Step 6. Here we can combine the Entry Summary Selectivity Results, Liquidation, Team Review, Notice of Redelivery, and the Warehouse, Export and Destruction parts into one, Liquidation, CBP accepts the Documentation and Duty.