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CBP Guidance on Imported Cargo Shipped on Bankrupt Carrier

Wednesday, September 07, 2016
Sandler, Travis & Rosenberg Trade Report

U.S. Customs and Border Protection has set forth the actions to be taken in the following scenarios involving imported cargo being transported by Hanjin Shipping, a major ocean carrier that recently filed for bankruptcy. See separate article this issue regarding the Federal Maritime Commission’s actions concerning Hanjin.

Vessel Diverted to Foreign Port and Discharged. If a Hanjin vessel does not arrive in the intended U.S. port and diverts to a foreign port to discharge freight:

- the manifest and importer security filing must be deleted;

- all bills of lading need to be deleted (not cancelled);

- entries and entry summaries need to be cancelled;

- for cargo subsequently entering the U.S. via the land border or other means, a new entry should be filed at the appropriate port of entry; and

- for shipments subject to Food and Drug Administration requirements, filers must request deletion and a new Bio-Terrorism Act prior notice submission should be transmitted along with the new entry if the cargo subsequently enters the U.S.

Vessel Diverted to Foreign Port but Not Discharged. If a Hanjin vessel diverted to a foreign port of entry is not discharged but cargo is transferred to an alternative conveyance (e.g., barge) for arrival and discharge at the original intended U.S. port of entry (which should only be done in limited situations):

- no change is needed to the manifest, bill of lading, ISF, or pre-filed entries;

- a new FDA prior notice is not required; and

- the arrival date will reflect the date the conveyance arrives at the intended U.S. port to be offloaded.

Vessel Diverted to Another U.S. Port and Discharged. In any scenario in which shipments manifested for one U.S. port are discharged in a port other than the manifested port:

- manifest and bill information should be updated to reflect the port code where the freight will actually be discharged;

- no change is needed to the ISF but filers should monitor the ISF disposition codes to ensure that any changes to the manifest and bill information did not cause the original bill match to drop;

- pre-filed entries should be changed to reflect the actual port code of discharge (filers may opt to (1) use ACE cargo release corrections capability, which should be fully automated with minimal CBP intervention as long as the shipment is not held or arrived/released, or (2) initiate an electronic in-bond movement or use a 7512 to allow for intermodal transport of the goods to the original intended U.S. port for processing by CBP);

- entries may be cancelled and refiled for the new port of entry; and

- a new FDA prior notice is not required (filers can retransmit a corrected/updated prior notice).

In all cases under this scenario manifest and bill information should be updated but no change is needed to the ISF. CBP advises that without updating the bills of lading the shipments cannot be arrived at the first port of arrival, which will prevent entries from releasing. Changes in entry process with ACE cargo release have linked the entry release to the manifest arrival to increase the number of fully paperless transactions. Without this, paper entries and other documents will be needed for shipments not requiring examination or further processing with ACE. In addition, since shipments being held for examination or document review will need to be amended in any scenario, this process provides a standard process with most compliant transactions requiring minimal CBP intervention.

Vessel Diverted to Another U.S. Port but Not Discharged. No change is needed to the bill of lading or entries and the arrival date for the vessel will reflect the date the ship returns to the intended U.S. port to be offloaded.

Vessel Rests at Anchor and Not Diverted. When a vessel arrives in port but due to work stoppage rests at anchor until freight can be discharged:

- the carrier must continue to provide advance notification to local CBP ports of the pending arrival (CBP Form 3171);

- when a vessel arrives at a U.S. port (within CBP territory) and comes to rest, whether at anchor, dock, or harbor, carriers must notify local CBP vessel processing personnel;

- after initial arrival, a change to the vessel’s arrival status should be considered (vessel unarrived) to avoid automated cargo release and general order issues;

- the carrier and vessel agents should maintain close communication with the local CBP port vessel processing office to share information, updates, instructions, and port-specific guidance;

- CBP will work with the carrier on a case-by-case basis so the actual arrival date and time at the first U.S. port closely reflect the actual date/time the vessel begins to unlade the cargo; and

- CBP will take into consideration situations where cargo has been unladen but due to work stoppage cannot be moved from the dock.

In-bond (IT and T&E) cargo already in the U.S. moving under Hanjin’s bond to U.S. port for entry or export. This cargo must be arrived to process the entry and allow release. Customs brokers and others using ABI functions QP/WP can arrive and/or export any in-bond at destination. As an alternative, the in-bond document (or information as appropriate) can be delivered to CBP and in-bond destination to be manually arrived/exported.

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