U.S. Customs and Border Protection (CBP) recently issued a “trade process document” on its Centers of Excellence and Expertise (CEE) program that contained a number of interesting points (“Centers of Excellence and Expertise Trade Process Document: Responsibilities and Procedure for Participating Accounts and Their Brokers, Agents or Filers” (March 2014) copy available here). Given that the CEE program is CBP’s preferred (eventually, mandatory?) model for the future, we thought all importers should be aware of these points, so have summarized them for you below.
* Importers must apply and be approved to participate in the CEE test program.
* The CEE’s are meant to meant to be centralized, industry-specific groups that bring additional experience/expertise to entry transaction review (i.e., by grouping resources by industry, the goal is to do better with less) and increased uniformity for importers (i.e., reduce the chances of getting different treatment at different ports).
* There are currently 10 CEE’s [(1) Agriculture & Prepared Products – Miami; (2) Apparel, Footwear & Textiles – San Francisco; (3) Automotive & Aerospace – Detroit; (4) Base Metals – Chicago; (5) Consumer Products & Mass Merchandising – Atlanta; (6) Electronics – LA; (7) Industrial & Manufacturing Materials – Buffalo; (8) Machinery – Laredo; (9) Petroleum, Natural Gas & Minerals – Houston; and (10) Pharmaceuticals, Health & Chemicals – New York]. Importers can apply for the CEE that best fits their business.
* Once accepted, all consumption and ADD/CVD entries will be processed by the CEE. Participants are “strongly encouraged” to file the entries with the CEE electronically. The physical importations, however, can still move through the same ports of entries (i.e.., the supply chain does not need to be modified).
* All post-entry validations (including protests) for entries filed with a CEE will be handled by the CEE (revenue collection will continue to be handled by the port for the time being).
* Any Requests for Information/Notices of Action will be issued by the CEE and need to be responded to electronically.
* For entries subject to ADD/CVD (type 03 entries) that are filed with the CEE, the blanket certificates of non-reimbursement will need to be submitted to the CEE electronically.
* Protests will be processed by the CEE and can be filed electronically through ABI, or via paper with the Port. If filed electronically, the CEE must be designated. If filed via paper with the Port, then an electronic copy of the complete protest must be sent to the CEE.
* Reconciliation and drawback entries must continue to be filed with the authorized port of entry/drawback center.
* Enforcement actions will continue to be processed by the ports “until such time that automation allows for the Center to process FP&F actions.” The CEE will likely play a leading role in most enforcement actions, however.
* Participants that file a prior disclosure can choose to file the disclosure with the CEE, rather than with the Port of Entry concerned (notwithstanding what the regulations currently say).
* Participation in the CEE program is voluntary and participants may withdraw at any time.
In general, the CEE idea is a good one. There can be benefits to dealing with CBP Import Specialists who understand the industry, its products and issues. Of course, there can also be downsides to such an arrangement (e.g., once an Import Specialist associated with a CEE sees an issue with one importer, it is easier for him/her to see if everyone in that CEE has the same issue, etc.). As a result, you would want to have industry leading/well above average levels of compliance before choosing to participate in a CEE.
Also, given that participation is voluntary, we would recommend that you perform a high level cost-benefit analysis before applying. If you are not experiencing significant delays, not receiving numerous CF-28’s/CF-29’s from different ports of entry, etc., then there may not be much benefit to you participating in the CEE program (there would, in our view, be heightened enforcement risk, however). Conversely, if you are experiencing issues that can be addressed through having a single point of contact, then the benefits provided by the CEE program may outweigh the costs.
We hope this update is helpful. If you have any questions about the CEE program, its pro’s/con’s or whether you should participate, please let us know.