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U.S. CBP ramps up issuing of penalties for non compliant ISF Filing

     U.S. CBP

U.S. Customs and Border Protection (USCBP) has begun full enforcement of Import Security Filing – ISF 10 +2 and ISF 5 – regulations, including the issuing of penalties for non-compliance.  The following details outline the regulations and requirements of these mandates.

ISF 10+2
ISF 10+2 is a regulation approved at the end of 2008 by the USCBP.  The regulation requires certain information to be declared about cargo in containers bound for import into the United States by ship.  It does not apply to air or truck freight, nor does it apply to bulk shipping cargo.  This function is typically completed by the importer of record’s customs broker.  Since July 9, 2013, the regulation has been fully applied, with no flexibility around the imposition of penalties.  The information has to be submitted 24 hours before loading of vessel destined to the United States.
The name 10+2 refers to the information the exporter and importer should communicate about the cargo (10 items), as well as information regarding the stowage plan and container status (2 items).  The declaration can only be made electronically.

10 items:

  • Importer Registration Number
  • Consignee Registration Number
  • Seller details
  • Buyer details
  • Ship-to party
  • Manufacturer or supplier details
  • Country of origin
  • Tariff heading, according to the Commodity Harmonized Tariff Schedule
  • Details of where the container was packed
  • Consolidator (container packer) details

2 items:

  • Ship stowage plan
  • Container status messages

For ocean cargo travelling as Freight Remaining on Board (FROB), Immediate Exportation (IE) or Transport and Exportation (TE), ISF 5 filing must be submitted electronically 24 hours before loading of vessel destined to the United States.  This function is typically completed by the ocean carrier or booking party at origin.  Since March 15, 2019, the regulation has been fully applied, with no flexibility around the imposition of penalties.

5 items:

  • Booking party
  • Foreign port of unlading
  • Place of delivery
  • Destination/Ship to party
  • Harmonized tariff schedule number

Consequences of non-compliance with ISF 10+2 & ISF 5 regulations
There are four types of non-compliance:

  • Not making the declaration
  • Making a mistake or submitting an incomplete declaration
  • Submitting a declaration after the deadline
  • Not cancelling a declaration, e.g., if cargo changes destination or is abandoned

In all of the above cases, the prescribed sanctions range from a minimum of $5,000 USD per declaration to a maximum of $10,000 USD (if there is more than one type of non-compliance).   However, Customs authorities can take certain factors into consideration to reduce the amount, such as the percentage of incorrect declarations, measures taken by the importer to rectify the non-compliance, circumstances beyond the control of those making the declaration, incorrect information having been supplied by someone in the logistics chain, etc..  In the first scenario, Customs authorities can also withhold the cargo until the declaration is submitted.

For more information, contact David Lychek, Manager – Ocean & Air Services.

Quick Tip #17
When it doesn’t pay to control your freight

Origin or destination services at overseas locations often involve local knowledge (special collection or delivery requirements) that may best be left to the locals!

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