By Kathleen M. Murphy and Mollie D. Sitkowski

U.S. Customs and Border Protection (CBP) held its East Coast Trade Symposium on March 6 and 7 2014, which focused on the many changes that CBP is undergoing. Specifically, it highlighted CBP’s commitment to focus enforcement on high-risk imports while streamlining importations for everyone else, using such initiatives as the Centers of Excellence and Expertise (CEE) and the Trusted Trader Program. The then-Acting Commissioner Thomas Winkowski announced significant changes to the pilot programs of the CEE, some of which were detailed in the March 10, 2014 Federal Register.

The CEEs are virtual organizations that leverage technology to centralize all the entries of certain importers through one location. They are aligned by industry sectors and include: Agriculture & Prepared Products; Apparel, Footwear, & Textiles; Automotive & Aerospace; Base Metals; Consumer Products & Mass Merchandising; Industrial & Manufacturing Materials; Information Technology & Consumer Electronics; Machinery; Petroleum, Natural Gas, & Minerals; and Pharmaceuticals, Health & Chemicals. Currently, the CEEs only process the entries of importers who have been accepted into the CEE pilot programs.

According to Mr. Winkowski, the CEEs will be undergoing significant changes to their programs since they were originally announced in the Federal Register in August 2012 and April 2013. For example, three CEEs will soon begin processing all entries for their respective industries, whether or not an importer has joined the CEE or not. Through an internal order, CBP will be giving port directors of the Electronics CEE in New York, the Pharmaceuticals CEE in Los Angeles, and the Petroleum CEE in Houston the authority to handle all entries.

This shift of more authority to CEE port directors marks a major step in CBP’s plans to open the use of CEEs to all filers and move to a more virtual trade processing environment. Empowering only three CEEs for the time being will give CBP the ability to monitor closely how well this concept works. Acting Commissioner Winkowski did not provide more information on the timing of the changes, however.

In addition, the Acting Commissioner and the Federal Register notice described additional changes to the CEE program, which took effect on March 10, 2014. Those changes include shifting coverage of several products between CEE and giving the CEE port directors the authority to process additional entry types, to waive certain regulatory requirements, and to clarify where to send responses to Notices of Action and Requests for Information.

The product shifts will only affect the following centers: Automotive & Aerospace; Base Metals; Consumer Products & Mass Merchandising; Industrial & Manufacturing Materials; Machinery; and Petroleum, Natural Gas & Minerals. Product coverage for the remaining CEEs will stay the same.

Further, CEE port directors now have the authority to process additional types of entries, including consumption entries, informal entries, temporary importations under bond, and trade show entries. In addition, all AD/CVD entries will be processed by the CEEs. CBP is also waiving the agency’s regulations and granting the CEEs authority to  correct claims for duty-free treatment. Finally, CBP clarified that responses to requests for information and notices of action must be sent electronically to the CEE for disposition.

Ultimately, CBP intends that the CEEs will be able to focus on industry-specific issues and provide tailored support for their trade partners. This, CBP believes, will speed clearance times and provide additional services to importers.

For more information on how your company can take advantage of the CEEs, please contact one of the authors listed above or any other member of Drinker Biddle's Customs and International Trade team.  

Source: Client Alert