CBP Proposes Elimination of Paper In-Bond

On 4/22/2012, CBP published a Notice of Proposed Rule Making outlining changes in the in-bond process.

Today, CBP continues to accept paper in-bond forms (CBP form 7512). The proposed changes would require all in-bond filers to electronically submit their in-bond applications. Additionally, these changes would require:

  • Inclusion of the Harmonized Tariff Schedule number,

  • Require the container and seal number,

  • Establish a 30 day maximum time to transport in-bond cargo between US ports,

  • Require electronic requests for permission before diverting the in-bond cargo, require the notification of in-bond arrival within 24 hours of arrival at the port of destination or export

  • Require carrier to provide the physical location of the cargo within the port.

Changing in house systems to accommodate these new requirements and establishing the ability to send in-bond requests electronically are time consuming and expensive.

Today, many larger ocean carriers and NVOCCs already file their requests for in-bond movement electronically. However, niche carriers, small NVOCCs, CES, CFS and trucking companies typically either submit the actual paper form 7512 or, pay a broker to file on their behalf. Even some of the larger electronic filers may find it difficult to modify their existing systems to accommodate some of the changes such as including container and seal numbers, diversion requests and submission of FIRMs codes for inspection.

CBP is currently under the comment review period, therefore, no further comments or suggestions can be made and CBP cannot communicate further to the trade about what may or may not be added to the proposed rule when the final rule is handed down. One thing is certain – that is that there will be changes coming to the way in-bonds are handled by CBP. The final rule is expected within the first half of 2013, after which there will be a 60-90 day period for readiness. With the implementation of ACE last month, there is very little doubt that electronic filing will be mandatory.

If you are not prepared to modify your existing electronic process to meet the demands of a new rule, or, if you don’t have any electronic options available to you to comply with this requirement, or broker fees are becoming more and more of a drain on your bottom line, please contact Vilden Associates. We have the products, knowledge and CBP experience to make this change painless for you.