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CBP Working to Centralize Single Transaction Bonds Under ACE

Thursday, December 05, 2013
Sandler, Travis & Rosenberg Trade Report

U.S. Customs and Border Protection told industry representatives recently that it plans to start work next February on the development of a centralized system for single transaction bonds within the Automated Commercial Environment. In preparation for the so-called eBond system, CBP is meeting with sureties, customs brokers and trade groups to review existing systems and operations and obtain feedback.

In a report to the Advisory Committee on Commercial Operations of CBP (COAC), CBP said it currently finds itself in a similar situation with respect to STBs as it did in 2002 with respect to continuous transaction bonds. At that time the agency was under pressure from a variety of sources to strengthen bond review and establish a central group to oversee the bond process to promote uniformity and consistency in the application and execution of bonds. After visiting several smaller ports to further understand the process, CBP centralized the CTB program within its Finance Center in Indianapolis. CBP says this move was “ultimately successful” as it has not faced a single case in the Court of International Trade due to execution errors on CTBs and bond error reject rates recently dropped to approximately 4%.

CBP says it is now under pressure from the trade community, Congress, the Department of Homeland Security’s Office of Inspector General and others to centralize STBs as well. Ports are having trouble retrieving and properly executing STBs, and CBP has 167 cases in front of the CIT resulting from bond execution errors alone. The STB Working Group within COAC’s Trade Enforcement and Revenue Collection Subcommittee adds that the current system also poses challenges with respect to potential delays in processing time, decentralized processes, errors due to manual bond completion, staff attrition, inadequate training, system interoperability issues, and lack of an STB indicator in ACE.

CBP is therefore working to centralize the STB program and implement the eBond concept within ACE, which will provide an electronic system for receiving, processing, reviewing and maintaining bond data. The STB Working Group states that other elements of the vision for an STB solution include centralized and standardized procedures, transfer of bond submission ownership to sureties and brokers (though CBP anticipates that under eBond brokers will not be able to push bonds to CBP without surety or surety agent approval), uniform procedures for bond monitoring, updated electronic entry, system accountability for the trade, integrated information systems, improved training and staffing levels, and enhanced data analysis capabilities.

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