Simplified Processes Initiative

Transcription

1 Simplified Processes Initiative March

2 Simplified Processes Initiative Background Objective: Develop transformation strategy and manage implementation of policy, processes and technology recommendations to optimize the import and export process through collaboration with the trade and CBP. Background: In 2011, CBP launched the Simplified Processes Initiative, a collaborative effort to develop innovative solutions to critical issues emerging at the intersection of trade facilitation, enforcement, and national security. The successes resulting from the start of this initiative, to include the Simplified Entry pilot, established a foundation for new solutions aimed at simplifying the importation process. CBP reengaged the Simplified Processes Initiative in 2014 to advance border security and management; enhance U.S. competitiveness by enabling lawful trade and travel; and promote organizational innovation all in line with Commissioner Gil Kerlikowske s CBP 2020 Vision and Strategy. Approach: A Simplified Processes Working Group was established to identify challenges and discuss potential solutions to critical trade needs; gather requirements; and develop a proposed alternative Summary and Revenue Collection Examined the import summary and revenue collections processes and identified opportunities for improvements. Developed a draft Simplified Processes concept, which included recommendations to improve the Entry Summary, payment, and adjustment processes. Other Post-Summary Processes Conducted a research and development effort to define the desired future-state of post-summary processes. Identified government and trade business needs and opportunities for improvement within the reconciliation, liquidation, protest, drawback and remote location filing (RLF) processes. Recommendations Refinement & Prioritization Socialize recommendations from Phase 1 and Phase 2 Working Group sessions with associations. Prioritize recommendations based on inputs and feedback. Develop a multi-year Simplified Processes Action Plan. Plan for the future of ACE and programmatic enhancements. 2

3 The working groups from 2014 and 2015 proposed recommendations that transform existing programs and processes. The working groups developed over 60 recommendations to improve the import process starting from the vetting of Trusted Trader programs, to filing an Entry Summary, the finalization of Drawback claims, to liquidating entries. Below are several key recommendations across the functional areas analyzed by the working groups. Functional Area Monthly Summary & National Statements Key Recommendations Filers may submit a monthly summary that includes releases over a calendar month's time. Each line of a monthly summary is considered a "reconfigured entry" that is subject to liquidation, protest and any other downstream process. A separate National Financial Monthly Statement will include debits (duties, taxes, fees, bills and interest) and credits (refunds) netted as a total balance due for a calendar month. Liquidation Allow for deem liquidation of all consumption entries at one (1) year from the date of entry. Implement processes to accommodate line-level liquidation. Allow for the importer to obtain liquidation status details from their ACE portal account or CBP.gov. Protest Transition the protest process to an electronic format. Expand the electronic protest filing to a broader range of trade stakeholders such as attorneys, importers, and sureties. Auto-populate numerous Entry Summaries onto one protest while providing protest statuses on ACE. Reconciliation File all reconciliation data electronically and only with necessary data elements. Eliminate the requirement of having to file an 09 entry and extend liquidation for flagged entries/lines an extra year from the date of entry. Manage reconciliation by account and permit filing at any Center or POE. Drawback Develop a process for the claimant to submit a drawback profile electronically along with automating other Drawback processes in ACE. Track/validate if the bond coverage is sufficient prior to processing an Accelerated Payment requests. Initiate the Desk Review and response processes electronically, to include DIS. 3

4 We are already implementing many of these recommendations as part of the ACE 2017 deployment. Liquidation Official notice of liquidations (bulletins) will be entirely paperless and will be posted on CBP.gov. Liquidation will occur on weekly cycle vice the biweekly cycle it currently follows. Importers have the ability to obtain liquidation status details from their ACE portal account. ACE has the technical infrastructure to implement new updates and liquidation processes modifications. For example, ACE has the capability to liquidate and account for changes in duties, taxes, and fees at the line level. Protest Protest can be submitted electronically through a Protest Portal. Filers can easily upload up to 9,999 entries using standard.xls or.cvs files. ACE will automatically generate a protest tracking number. If a protest is submitted electronically, then the approval or denial notification will be sent electronically. The system will provide an interim status of submitted protest. Reconciliation Reconciliation will be filed electronically. As a result, CDs and spreadsheets are no longer required. Trade will no longer need to provide original and reconciled amounts. Trade will only need to provide reconciled amounts, as the system will automatically calculate duties, taxes, and fees of the original entry. Working towards expanding Reconciliation processing beyond the 13 designated ports. The goal is to have the reconciliation program expanded across all 10 Centers. Drawback ACE controls will track and validate if the bond coverage is sufficient prior to processing an Accelerated Payment request. Developed a process for the claimant to submit a drawback profile electronically leveraging the 5106 form. CBP Form 7552 will be eliminated with respect to Certificate of Manufacture and Delivery (CM&D). The desk review and response process will be electronic and will include DIS capability. 4

5 Mockup Development Data Analysis Stakeholder Engagement Simplified Process Initiative: Activities in 2016 The team leveraged the following approach to develop a transformation strategy that manages the implementation of policy, processes, and technology recommendations in order to optimize the process of importing goods through collaboration with the trade community and CBP. Engaged with 14 trade associations including: AAEI, BACM, NAM, PCC, NRF, CSEC, NCBFAA, USCIB, BTA, EAA, NAFTZ, NBCBA, ITSA, API. Trade associations were asked to contact their members for priorities as well as quantitative and qualitative benefits of Simplified Processes. Coordinated with ACE Business Office to discuss ongoing Post-Summary accomplishments related to Simplified Processes. Facilitated two meetings with U.S. Census to discuss the impact to their analysis and reporting if a simplified summary recommendation was implemented. Facilitated three workshops with AAEI members, hosted by Honda. Attendees included importers, brokers, sureties, and software developers. Analyzed 5 months of entry data for a selection of filers from Center industries. Reviewed nearly 100,000 entries and 250,000+ lines to determine opportunities where filers could potentially benefit from transitioning to a monthly Simplified Summary format. Additionally analyzed impacts of a National Monthly Statement and how it can streamline the amount of Daily and Periodic Monthly Statements. Developed a Monthly Statement mockup to include debits (duties, taxes, fees, bills and interest) and credits (refunds) netted as a total balance due for a calendar month. Coordinated with CBP and ABO SMEs to determine header and line level requirements for a Simplified Summary. Developed a Monthly Summary mockup based on the data analysis for stakeholder discussion. 5

6 CBP will prioritize its efforts to develop the Simplified Processes Road Map Four factors will be used to evaluate and prioritize recommendations: Factor 1 Stakeholder Priority Factor 2 Business Requirement Factor 3 System Infrastructure and Capability Factor 4 Statutes and Regulations Is the recommendation a top priority for the trade? Has the concept been vetted by stakeholders, and has a design been developed? Does the capability and technological infrastructure exist within ACE/CBP Systems? Does the recommendation requires statue or regulation changes? High priority for a majority of the trade Business requirements for the recommendations are developed, or are in the process of being finalized The capability and technological infrastructure exist within ACE/CBP Systems The recommendations do not require statue or regulation changes A high priority for select members of the trade, or considered a mid-tier priority Business requirements for the recommendations are in the development phase The capability and technological infrastructure partially exist within ACE/CBP Systems and would require modifications The recommendations potentially requires statue or regulation changes and additional research is needed Not seen as a top priority for a majority of the trade The business requirements for the recommendations have not been developed The capability and technological infrastructure does not exist within ACE/CBP Systems The recommendations do require statue or regulation changes Top Recommendations: National Monthly Statement (phased implementation) Line-Level Liquidation (longer term) Reconciliation (eliminating 09 Entry; use PSC process) Monthly Summary 6

7 NATIONAL MONTHLY STATEMENT The proposed next steps for designing and developing the requirement for the Monthly Statement include rolling out three different phases. Each phase would be a version of the Monthly Statement that would include a new feature that accounts for a different type of financial transaction (e.g., bills, refunds, protests, and possibly drawback). Improves the Periodic Monthly Statement process and streamlines financial transactions Version 1.0 Requirements and format would include all entries in a calendar month for all POEs into one statement Process would apply for both importer statements and broker statements Eliminate the need for Daily Statements Version 2.0 Adding bills incurred during the referenced calendar month Statute changes need to address 30-day due date requirement Immediate need is adding additional payment methods, like Pay.gov, to pay bills and in an aggregate manner Version 3.0 Adding refunds (excluding Drawback) that accrued during the referenced calendar month. This may be difficult from an accounting perspective Collections and Financials need to be fully incorporated into ACE Petroleum Importer 1,098 Daily Statements 88 Periodic Monthly Statements 6 National Monthly Statements Initial data analysis on how a National Monthly Statement can streamline the Periodic Monthly Statement process for one petroleum importer in a 3-month period 7

8 The Monthly Statement captures all transactions, including credits and debits issued from bills and refunds. DRAFT MONTHLY STATEMENT MOCK-UP: FOR DISCUSSION Entry Summary Number Entry Date Entry Summary Date Entry Type Filer Code Processing Port/CEE Monthly Entry Data Reference Num. Duty Tax Interest ADD CVD MPF HMF ZZZ /1/2016 6/11/ ZZZ $90,000 $4,500 $900 $0 $0 $100 $20 $50 $95,570 ZZZ /3/2016 6/13/ ZZZ $18,000 $900 $180 $30 $0 $100 $20 $0 $19,230 ZZZ /5/2016 6/15/ ZZZ $20,000 $1,000 $200 $0 $0 $100 $20 $0 $21,320 ZZZ /7/2016 MONTHLY MULTI ZZZ-003 MNTHLY $0 $0 $0 $0 $0 $100 $20 $250 $370 ZZZ /9/2016 6/19/ ZZZ $14,000 $700 $140 $0 $0 $100 $20 $100 $15,060 ZZZ /11/2016 6/21/ ZZZ $0 $0 $0 $0 $0 $100 $20 $200 $320 ZZZ /13/2016 6/23/ ZZZ $0 $0 $0 $0 $3,000 $100 $20 $0 $3,120 ZZZ /15/2016 6/25/ ZZZ $0 $0 $0 $0 $0 $100 $20 $0 $120 ZZZ /17/2016 6/27/ ZZZ $60,000 $3,000 $600 $0 $0 $100 $20 $100 $63,820 ZZZ /19/2016 6/29/ ZZZ $22,000 $1,100 $220 $0 $0 $100 $20 $0 $23,440 ZZZ /21/2016 MONTHLY MULTI ZZZ-010 MNTHLY $50,000 $2,500 $500 $0 $0 $100 $20 $200 $53,320 ZZZ /23/2016 7/3/ ZZZ $10,000 $500 $100 $0 $0 $100 $20 $0 $10,720 ZZZ /25/2016 7/5/ ZZZ $0 $0 $0 $0 $0 $100 $20 $0 $120 ZZZ /27/2016 7/7/ ZZZ $36,000 $1,800 $360 $0 $0 $100 $20 $0 $38,280 ZZZ /29/2016 7/9/ ZZZ $20,000 $1,000 $200 $0 $0 $100 $20 $100 $21,420 Totals $340,000 $17,000 $3,400 $30 $3,000 $1,500 $300 $1,000 $366,230 Other Bills and Refunds Importer Name: IMPORTER ABCD Protest or Claim Entry Case Filing Entry Date Entry Summary Date Entry Number Processing Port Liquidation Date Duty Tax Interest ADDImporter Number: CVD ABCDE Fees or MPF HMF Filer Code: Total ZZZ-000 Number Type Date Penalty Importer ACE ID: AABB Filer Name: ZZZ Brokerage PRTST CLAIM 001 6/1/2016 6/11/ ZZZ /1/2016 ($25,000) $4,500 $900 $0 $0 $0 $0 ($100) ($19,700) Processing CEE: Electronics PRTST CLAIM 002 6/3/2016 6/13/ ZZZ /15/2016 $0 $900 $180 $30 $0 $0 $0 $50 $1,160 Bill /5/2016 6/15/ ZZZ $10,000 $1,000 $200 $0 $0 $0 $0 $0 $11,200 Monthly Entry Summary Totals: Bill /7/2016 6/17/ ZZZ ($30,000) $1,000 $200 $0 $0 $0 $0 ($50) ($28,850) Total Duties Total Tax Total ADD Total CVD Total MPF Total HMF Total Fees Totals ($45,000) $7,400 $1,480 $30 $0 $0 $0 ($100) ($36,190) $340,000 $17,000 $3,400 $30 $3,000 $1,500 $300 Fees or Penalty Total EIN Number EIN ### Entry Summaries and Monthly Summaries filed within the Monthly Statement reporting period Net balance owed or refunded after aggregating all debits and credits for one final financial transaction $366,230 Monthly Other Bills and Refunds Totals: ($36,190) Processed bills and refunds from VA reviews and/or Protest cases posted during the Monthly Statement reporting period Total Duties Total Tax Total ADD Total CVD Total MPF Total HMF Total Fees ($45,000) $7,400 $1,480 $30 $0 $0 ($100) Total Due: $330,040 8

9 LINE-LEVEL LIQUIDATION Working Group recognized this is an inevitability, but stated it would be a paradigm shift to start tracking everything at the line level. U. S. C U S T O M S A N D B O R D E R P R O T E C T I O N Line Level Liquidation Life Cycle Process S I M P L I F I E D P R O C E S S E S : P O S T - R E L E A S E W I T H L I N E - L E V E L L I Q U I D A T I O N CARGO IS RELEASED ENTRY SUMMARY IS FILED DUTY, TAXES AND FEES ARE PAID RLF FOR ALL ENTRY TYPES 1 LINE 1: NO ACTION NEEDED COO HTS QTY VALUE LINE 2: POST SUMMARY CORRECTION (PSC) (COMPLETE REPLACE) LINE 3: RECONCILIATION LINE 4: SUSPENSION/EXTENSION COO HTS QTY VALUE COO HTS QTY VALUE FLAGGED FOR RECONCILIATION AT FILING (OPTIONAL) COO HTS QTY VALUE Filer options: File a post summary correction Can request accelerated liquidation +TBD DAYS SUSPENSION AD/CVD 1 YEAR TBD DAYS Filer options (via PSC): Retroactive flag, extension If un-flagged, extension is removed TBD DAYS LIQUIDATION +POST NOTICE LIQUIDATION +POST NOTICE PROTEST (UP TO 180 DAYS) Filer options: Submit changes (if none, perform no action) If change is made, set for liquidation Can request accelerated liquidation Can submit changes in an aggregate manner LIQUIDATION +POST NOTICE (IF UNFLAGGED) PROTEST (UP TO 180 DAYS) RECONCILIATION DATA UPDATES Can CBP have two liquidation processes (header & line-level) for filers to choose? Confirm line-level liquidation should be completed before reconciliation and monthly summary Protest/AFR is properly linked to collections Protest claims are linked against the same decision by different authorized parties The process is automated for linking data directly related to a protest 2 YEARS LIQUIDATION +POST NOTICE (IF NO ACCELERATED LIQUIDATION REQUESTED) Open Items PROTEST (UP TO 180 DAYS) DRAWBACK (UP TO 3 YEARS) DRAWBACK (UP TO 3 YEARS) DRAWBACK (UP TO 3 YEARS) Identified Benefits 1. Line-level liquidation allows importers and filers to liquidate entry summaries without having to wait for lines subjected to AD/CVD case reviews or other CBP reviews to be resolved. 2. Since Drawback is filed at the linelevel, having line-level liquidation would allow importers to submit their Drawback claims a lot faster. 3. Importers with limited importer goods and Special Program Indicators (SPIs) would benefit form line-level liquidation. 4. With line-level liquidation, an importer can file a protest at the line-level and closeout remaining transactions. 5. CBP operates at the line-level and many of the post-summary processes are executed at the line level (e.g., drawback, Recon, Protest) which can help streamline CBP s workload. Identify downstream effects and touch points including how MPF would be handled Confirm legal challenges 9

10 MONTHLY SUMMARY: Analyzing How to Create a Monthly Summary Requirements Output Step 1 Identify Identify header and line-level requirements for CBP to process "reconfigured" entries based on previous Working Group feedback Surety Number Manufacturer ID Reviewed Entry Summary (CBP Form 7501) input fields and identified the inputs CBP requires to facilitate trade and conduct trade enforcement activities Step 2 Analyze Based on the Step 1 assumptions, determine opportunities where importers across different industries could potentially benefit from transitioning to a Monthly Summary format Importer Number Surety Number Bond Numbers Consignee Number HTS Codes Entry Types Country of Origins Selected importers from different industries and analyzed over 100,000 entries, consisting of 250,000+ lines to better understand their respective monthly importing trends Step 3 Reconfigure Based on Step 2 activities, restructure data to form a more streamlined, efficient and user-friendly Monthly Summary format Consolidated line level information under the identified key requirements and reconstructed a proposed Monthly Summary format Examples Importer #1 Entries consolidated into 1 Monthly Summary Importer #2. Entries consolidated into 1 Monthly Summary Importer #3. 4, ,789 Entries consolidated into 1 Monthly Summary Importer # Entries consolidated into 1 Monthly Summary (Petroleum Industry) (Pharmaceutical Industry) (Apparel Industry) (Automotive Industry) 10

11 MONTHLY SUMMARY: Mockup, Benefits, and Other Feedback A Monthly Summary example Entry HTS Estimated Estimated Estimated Type HTS MID Number MOT COO COE SPI Quantity 1 Duty (HTS) Duty (AD) Duty (CVD) 01 HTS-AAAA-101 MID-ZZZ COO-1 COE $ 24,150 $ - $ - HTS-AAAA-101 MID-ZZZ COO-1 COE $ 25,200 $ - $ - HTS-AAAA-101 MID-ZZZ COO-2 COE $ 24,675 $ - $ - HTS-AAAA-102 MID-ZZZ COO-1 COE $ 34,125 $ - $ - HTS-AAAA-102 MID-ZZZ COO-3 COE $ 40,425 $ - $ - HTS-AAAA-102 MID-ZZZ COO-2 COE $ 28,350 $ - $ - HTS-AAAA-102 MID-ZZZ COO-1 COE $ 37,100 $ - $ - HTS-AAAA-103 MID-ZZZ COO-1 COE $ 39,275 $ - $ - HTS-AAAA-103 MID-ZZZ COO-2 COE $ 41,450 $ - $ - HTS-AAAA-104 MID-ZZZ COO-1 COE $ 43,625 $ - $ - HTS-AAAA-104 MID-ZZZ COO-3 COE $ 45,800 $ - $ - HTS-AAAA-104 MID-ZZZ COO-2 COE $ 27,975 $ - $ - HTS-AAAA-105 MID-ZZZ COO-1 COE $ 50,150 $ - $ - 11 HTS-AAAA-106 MID-ZZZ COO-1 COE $ 52,325 $ - $ - HTS-AAAA-106 MID-ZZZ COO-2 COE $ 44,500 $ - $ - HTS-AAAA-107 MID-ZZZ COO-1 COE $ 26,675 $ - $ - HTS-AAAA-107 MID-ZZZ COO-3 COE $ 58,850 $ - $ - HTS-AAAA-108 MID-ZZZ COO-2 COE $ 41,025 $ - $ - HTS-AAAA-108 MID-ZZZ COO-1 COE $ 63,200 $ - $ - HTS-AAAA-109 MID-ZZZ COO-1 COE $ 25,375 $ - $ - HTS-AAAA-109 MID-ZZZ COO-2 COE $ 67,550 $ - $ - HTS-AAAA-110 MID-ZZZ COO-1 COE $ 39,725 $ - $ - HTS-AAAA-111 MID-ZZZ COO-3 COE $ 51,900 $ - $ - HTS-AAAA-111 MID-ZZZ COO-2 COE $ 24,075 $ - $ - HTS-AAAA-112 MID-ZZZ COO-1 COE $ 36,250 $ - $ - HTS-AAAA-112 MID-ZZZ COO-1 COE $ 48,425 $ - $ - Feedback from the trade and Partner Government Agencies 1. Further define proposed requirements and structure of the Monthly Summary 2. Due to the time, resources, and investment needed to participate in a monthly summary program, the fees (i.e., MPF) need to be reduced to add to as a benefit 3. CF-28 and Audit pools would need to be reduced as an added benefit 4. Propose a cap on liquidated damages to offset the financial risk Identified Benefits 1. Organizing thousands of entries into a single Monthly Summary, the cost and manpower of an importer to maintain and for CBP to verify compliance would potentially be dramatically reduced. 2. Instead of managing hundreds or even thousands of financial transactions (including checks), the importer can file a single Monthly Summary with a single estimated amount of duties, taxes, and fees due at the 10th calendar day of the subsequent month. 3. The data provided to CBP and PGAs from the trade community will be updated and more accurate. Currently, there is a 10-day requirement to file an entry summary. If the Monthly Summary is due in the following month, then importers have more time to modify their entry information with more informed/precise data. 4. The use of reconfigured entries on Monthly Summary enables each issue with respect to the covered imports to be handled individually without reference to other reconfigured entries. This allows importers to receive refunds without having to wait for all other issues to be resolved. 5. Census requires the Monthly Summary to be submitted by the 10 th calendar day of the subsequent month in order to meet U.S. economic and GDP reporting requirements 11

12 The Reconciliation changes and recommendations are intended to automate and simplify the paper-based and cumbersome process. A lot of good discussion with the working group on the Reconciliation program improvements to be implemented during the next ACE development Group recommended the trade community see how the upcoming improvements work with their business operations before additional enhancements are added into ACE Reconciliation is recognized as one program that needs the most streamlining Remaining Reconciliation Recommendations Extend liquidation for flagged entries/lines an extra year from the date of entry. This will change the current process for the various types of Reconciliation and associated liquidation periods (e.g., NAFTA). Eliminate the separate filing of 09 entry. This will be achieved through the Post-Summary Correction (PSC) process. If the reconciled entry requires updates (e.g., classification or value), the filer will make the changes and then the entry will then be subjected to liquidation. If no PSC is made, it indicates no changes are needed on the reconciled entry and is then subjected to liquidation. Allow a filer to retroactively flag/un-flag an entry/line through a PCS in ACE up to the deem liquidation date. When unflagged, the entry/line will revert back to the original deem liquidation date. Receive and process reconciliation issue changes for an entry in an aggregate manner (i.e. rolled up by Harmonized Tariff Schedule (HTS), country of origin, Manufacturer Identification Number (MID), or other common data element(s)) or at the line level using the entry number and reconciliation adjustment. Systemically account for all changes at the line level. Allow for the filer to request accelerated liquidation of the underlying entry when an entry/line is reconciled. Implement the Simplified Processes Reconciliation requirements in a phased manner in order to accommodate more complex entry types (e.g., 03-Consumption AD/CVD). 12

13 Reconciliation Process Concept Filers will flag an entry line for reconciliation which extends the liquidation date an extra year The filer can unflag the entry line during the normal PSC process timeframe within the first year, which will revert the liquidation date back to the one-year mark If no reconciliation changes are required, no action is required and will be set for liquidation Reconciliation changes made via the PSC process and can be done in an aggregate manner S I M P L I F I E D P R O C E S S E S : L O N G - T E R M V I S I O N O F R E C O N C I L I A T I O N CARGO IS RELEASED ENTRY SUMMARY IS FILED DUTY, TAXES AND FEES ARE PAID RLF FOR ALL ENTRY SUMMARIES Filer options: File a post summary correction Flag or retroactive flag If un-flagged, extension is removed Eliminate separate filing a 09 entry 1 YEAR 2 YEARS Filer options: Submit changes (if none are needed, perform no action) If change is made, set for liquidation Can request accelerated liquidation Can submit changes in an aggregate manner EXAMPLE: LINE FLAGGED FOR RECONCILIATION COO HTS QTY VALUE ENTRY LIQUIDATION +POST NOTICE (IF UNFLAGGED) RECONCILIATION DATA UPDATES LIQUIDATION +POST NOTICE (IF NO ACCELERATED LIQUIDATION REQUESTED) PROTEST (UP TO 180 DAYS) DRAWBACK (UP TO 3 YEARS) 13

14 Question and Next Steps For additional information, please contact: Randy Mitchell, Director, Commercial Operations and Entry Division or 14