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Centers of Excellence Test Modified to Change Product Coverage, Expand Entry Types

Tuesday, March 18, 2014
Sandler, Travis & Rosenberg Trade Report

U.S. Customs and Border Protection has modified its general test of the Centers of Excellence and Expertise by modifying the scope of coverage for some centers and expanding the types of entries that the centers will process. CBP has also waived an additional regulation for test participants and clarified the submission process for responses to Requests for Information and Notices of Action.

CBP’s goal is to incrementally transition the operational trade functions that traditionally reside with the ports of entry until they reside entirely with the centers. By focusing on industry-specific issues and providing tailored support for participating importers, CBP is seeking to facilitate trade, reduce transaction costs, increase compliance with applicable import laws, and achieve uniformity of treatment at ports of entry. CBP believes that providing broad decision-making authority to the centers for entry processing issues will better enable them to achieve these goals and is conducting the test to determine if that is true.

Coverage Modifications. CBP is modifying the scope of coverage for the following centers as indicated.

Automotive & Aerospace – HTSUS heading 8511, HTSUS, which was previously covered by the Machinery Center, has been added.

For inclusion in the Automotive & Aerospace Center, importers must be part of the automotive, aerospace, or other transportation equipment and related parts industries, with the highest percentage of their entries comprised of related merchandise. For purposes of this center, the term “automotive” includes merchandise classified under headings 8701 through 8711, 8713, 8714 and 8716; the term “aerospace” includes merchandise classified under headings 8801 through 8805, and the term “other transportation equipment and related parts” includes but is not limited to merchandise classified under headings 4011 through 4013, 8406 through 8412, 8511,

8512, 8601 through 8609, and 8901 through 8908.

Base Metals – HTSUS heading 7414 has been removed because it does not exist in the 2014 HTSUS; headings 7309 through 7311 have been moved to the Industrial & Manufacturing Materials Center; and headings 7415 (which had been inadvertently omitted) and 8307 through 8311 (which were previously covered by the Machinery Center) have been added.

For inclusion in the Base Metals Center, importers must be part of the steel, steel mill products, ferrous and nonferrous metal, or similar industries, with the highest percentage of their entries comprised of related merchandise. For purposes of this center, the term “base metals” includes merchandise classified under HTSUS headings 7201 through 7308, 7312 through 7318, 7320, 7322, 7324 through 7413, 7415, 7419 through 7614, 7616 through 8113, and 8307 through 8311.

Consumer Products & Mass Merchandising – HTSUS heading 7013 has been moved to the Industrial & Manufacturing Materials Center and headings 9619 (which had been inadvertently omitted) and 8210 and 8539 (which were previously covered by the Machinery Center) have been added.

For inclusion in the Consumer Products and Mass Merchandising Center, importers must be part of the household goods, consumer products or similar industries and/or mass merchandisers of products typically sold for home use, with the highest percentage of their entries comprised of related merchandise. For purposes of this center, the term “consumer products and mass merchandising” includes merchandise classified under HTSUS headings 3303 through 3307, 3401, 3406, 3605, 3924, 3926, 4201, 4202, 4205, 4206, 4414, 4419, 4420, 4421, 4602, 4803, 4817, 4818, 4820, 4901 through 4911, 6601 through 6603, 6701 through 6704, 6911 through 6913, 7113 through 7118, 7319, 7321, 7323, 7418, 7615, 8210 through 8215, 8301, 8303 through 8306, 8469, 8470, 8508, 8509, 8510, 8513, 8516, 8539, 8712, 8715, 9001 through 9006, 9013, 9101 through 9114, 9201, 9202, 9205 through 9209, 9401, 9403 through 9405, 9503 through 9508, 9601 through 9619, and 9701 through 9706.

Industrial & Manufacturing Materials – HTSUS headings 4414 (which is already covered by the Consumer Products and Mass Merchandising Center) and 4815 (which does not exist in the 2014 HTSUS) have been removed. Headings 2501 through 2530 (which were previously covered by the Petroleum, Natural Gas & Minerals Center), 7013 (which was previously covered by the Consumer Products and Mass Merchandising Center), 7309 through 7311 (which were previously covered by the Base Metals Center) and 9406 (which was previously covered by the Machinery Center) have been added.

For inclusion in the Industrial & Manufacturing Materials Center, importers must be part of the plastics, polymers, rubber, leather, wood, paper, stone, glass, precious stones or precious metals, or similar industries, with the highest percentage of their entries comprised of related merchandise. For purposes of this center, the term “industrial and manufacturing materials” includes merchandise classified under HTSUS headings 2501 through 2530, 3901 through 3923, 3925, 4001 through 4010, 4016 through 4115, 4301, 4302, 4401 through 4413, 4415 through 4418, 4501 through 4601, 4701 through 4802, 4804 through 4814, 4816, 4819, 4821, 4822, 4823, 6801 through 6910, 6914 through 7011, 7013, 7014 through 7112, 7309 through 7311, and 9406.

Machinery – HTSUS headings 8485 (which does not exist in the 2014 HTSUS), 8210 and 8539 (which have been moved to the Consumer Products & Mass Merchandising Center), 8307 through 8311 (which have been moved to the Base Metals Center), 8511 (which has been moved to the Automotive & Aerospace Center) and 9406 (which have been moved to the Industrial & Manufacturing Materials Center) have been removed.

For inclusion in the Machinery Center, importers must be part of the tools, machine tools, production equipment, instruments or similar industries, with the highest percentage of their entries comprised of related merchandise. For purposes of this center, the term “machinery” includes merchandise classified under HTSUS headings 8201 through 8209, 8302, 8401 through 8405, 8413 through 8468, 8472, 8474 through 8484, 8486, 8487, 8505 through 8507, 8514, 8515, 9007, 9008, 9010, 9011, 9012, 9014 through 9017, 9020, 9023 through 9033, and 9301 through 9307.

Petroleum, Natural Gas & Minerals – HTSUS headings 2501 through 2530 have been moved to the Industrial & Manufacturing Materials Center and heading 3826 (which had been inadvertently omitted) has been added.

For inclusion in the Petroleum, Natural Gas & Minerals Center, applicants must be part of the petroleum, natural gas, petroleum related, minerals or mining industries, with the highest percentage of their entries comprised of related merchandise. For purposes of this Center, the terms “petroleum” and “natural gas” include merchandise classified under headings 2709 through 2713; the term “petroleum related” includes merchandise classified under headings 2701, 2705, 2707, 2708, 2714, 2715, 2716 and 3826; and the terms “minerals” or “mining” include merchandise classified under headings 2601 through 2621, 2702, 2703, 2704 and 2706.

Types of Entries Processed by Centers. CBP had previously said that all consumption entries filed before and during participation in the test, except for antidumping and countervailing duty entries, would be processed by the designated center regardless of the commodity listed on the entry line, upon the transition of processing as set forth in the CEE Trade Process Document.

CBP is now changing this process in two ways. First, as of March 10, the centers are processing the following entry types filed by test participants before and after they joined the test.

- consumption entries: free & dutiable (type 01)

- consumption entries: appraisement (type 04)

- consumption entries: foreign-trade zone (type 06)

- consumption entries: duty deferral (type 08)

- informal entries: free & dutiable (type 11)

- temporary importation under bond (type 23)

- trade fair (type 24)

CBP also anticipates that the centers will process the following entry types in the near future and will publish the effective date in the CEE Trade Process Document.

- consumption entries: quota/visa (type 02)

- consumption entries: vessel repair (type 05)

- consumption entries: quota/visa and AD/CV (type 07)

- consumption entries: reconciliation (type 09)

- informal entries: quota (type 12)

- warehouse entries: warehouse (type 21)

- warehouse entries: re-warehouse (type 22)

- permanent exhibition (type 25)

- warehouse withdrawal: for consumption (type 31)

- warehouse withdrawal: quota/visa (type 32)

- warehouse withdrawal: AD/CV duty (type 34)

- government entries: Defense Contract Management Area Office (type 51)

- government entries: federal agencies other than DCMAO (type 52)

The centers will not process any entries related to FTZ admissions (type 26) or transportation entries (types 61, 62 and 63).

Second, AD and CV duty entries filed by test participants before they joined the test will be processed by port directors, while all AD and CV duty entries filed during participation in the test will be processed by center directors.

Waiver of Additional Regulation. 19 CFR 10.847(c) is being waived so as to allow test participants to submit corrected claims for duty-free treatment under 19 CFR 10.847(a) to the center where the claim was originally filed rather than with the CBP port.

Responses to CBP Forms 28 and 29. CBP is clarifying that timely responses to these forms must be sent electronically to the test participant’s designated center.

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