Date: Nov 17, 2020
Magazine:
November/December 2020

Companies engaged in international trade face an ever-increasing amount of challenges in their import and export transactions on account of increased tariffs and regulatory scrutiny. Managing trade data on a routine day-to-day basis can be overwhelming and challenging but is a necessary task to assist with company-internal management of trade transactions.

Even more important, companies that receive a request for information, for example from Customs and Border Protection (CBP), the Bureau of Industry and Security, U.S. Department of Commerce (BIS) or the Office of Foreign Assets Control, U.S. Department of Treasury (OFAC) are usually asked to present specified trade data information under strict timelines. If trade data is not managed in a retrievable system and format, it may be impossible to comply with the tight timeline set forth in the request for information. Fortunately, CBP has developed a system, the Automated Commercial Service (ACE) Portal, where exporters and importers are able to access their own trade data collected by the U.S. government. One of the added bonuses is that ACE is free of charge!

An organization can apply for an ACE Portal as an importer, exporter or as a dual account, with an expected turnaround time of three to five business days, although this time may vary. When applying for a dual account, the applicant must request the Importer Account first and only once the Importer Account has been approved, will it be possible to set up the Exporter Account. All Exporter Accounts that are set up without a corresponding Importer Account require additional vetting from the U.S. Census Department, a process that can extend several weeks.

The ACE Portal for Imports provides visibility to entry numbers, ports, entry dates, HTS classifications and corresponding tariffs, CBP actions taken for each entry and a multitude of other elements in a searchable format, all of which provide an excellent window into the international trade transactions for the importer. The ACE Portal for Imports offers the capability to run specialized reports filtered across many shipping data elements, including the so-called Importer Trade Activity feature (ITRAC), that provides visibility into CBP exams, Import Specialist reviews and other CBP inquiries. When advising a company on its trade matters, we find the ACE Portal essential to understanding the footprint of the company’s trade transactions.

The Export ACE Portal provides extensive insight into Automated Export System (AES) filings and the listed Electronic Export Information (EEI) data elements. It is important to review in real time the AES data and maintain regular compliance audits of an organization’s export activity to assure that the AES system accurately displays all export activity. Submission of accurate AES data elements is the responsibility of the exporter and is subject to penalties. Many exporters delegate the filing of AES data elements to its broker or shipper without fully appreciating the fact that the exporter always retains primary responsibility for the filing of timely and accurate AES filings. To manage this exposure, we strongly recommend the use of Shipper Letter of Instructions (SLI) that list and instruct the filer on all required EEI data elements and then confirm SLI compliance through regular audits.

Prior Disclosures submissions, a remedy that is available to both importers and exporters to reduce the exposure of penalties, require a detailed explanation of the violation and its surrounding circumstances. A Prior Disclosure provides relief only for those matters that are disclosed. To get the full protection available through the Prior Disclosure process, it is important to review and present the circumstances surrounding the alleged violations for the entire statute of limitation period (in most cases five years). If the trade data related to the violation is not available for the entire statute of limitations period, a Prior Disclosure may no longer be an option. Having access to the ACE Portals is an essential tool to trade data access in an efficient manner.

In addition, exporters and importers are responsible for adhering to the applicable record-keeping requirements (generally not less than five years) and be able to retrieve all export and import trade documentation as required. For example, CBP generally requires the requested data to be produced within 30 days. Customs Broker and Freight Forwarders may maintain the transaction trade data as well, but the primary responsibility of the recordkeeping requirements is placed on the exporter and importer. Customs Brokers and Freight Forwarders are an excellent resource; however, the ultimate responsibility remains with the importer of record and the exporter.

ACE is an indispensable element for the maintenance of “best practices” for import and export trade data management. Not only will the ACE Portal assist with compliance audits and managing responses to inquiries by regulatory agencies, it is also a wonderful resource in navigating business planning by providing an organized overview of past and present data points that assist in developing targeted business plans for international trade.

Please feel free to contact any member of the DCG or other Dentons group for assistance in Customs and Export Control matters.

 

WG Staff Contact

Jason Resnick
Sr. Vice President & General Counsel
949-885-2253

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