CBP Reiterates Limitation on Entry Preparation Work by Non-Brokers

U.S. Customs and Border Protection recently issued a ruling (HQ H326926) stating that an unlicensed company would impermissibly conduct customs business by extrapolating entry-related data from shipping documents and keying that data into a customs broker’s Automated Broker Interface software.

This ruling responds an inquiry from a licensed broker regarding its potential use of an unlicensed foreign company to review shipment documents (e.g., bills of lading and commercial invoices), extrapolate certain data elements necessary to file entry for the imported goods, and key that data into the broker’s ABI system. The broker said the unlicensed company would be prevented from transmitting entry data to CBP directly, generating customs documents, or viewing importer files.

CBP states that this proposal closely parallels a scenario discussed in ruling HQ H068278, issued in September 2009, in which CBP determined that an unlicensed contractor using optical character recognition technology to scan shipping documents for the purpose of identifying and extracting data necessary for entry would impermissibly be conducting customs business by determining what valuation, classification, and other entry-related data would be transmitted to CBP as part of an entry filing.

In both cases, CBP states, identifying entry-related data and keying it into an ABI system falls squarely within the scope of “preparing parts of an entry intended to be filed with CBP,” which 19 USC 1641(a)(2) explicitly includes within the definition of “customs business” that must be conducted by a person holding a valid customs broker’s license.

CBP notes three additional concerns implicated by the broker’s proposal: (1) the unlicensed company is not a broker, importer, or ABI service bureau and under 19 CFR 143.1(a) is therefore ineligible to access ABI for entry and entry summary purposes, (2) that company has not applied nor been approved for access to ABI and is therefore not authorized to access ABI by utilizing the broker’s account, and (3) permitting a third party such as the unlicensed company to access an ABI account containing client records and data would breach the broker’s obligation under 19 CFR 111.24 to not disclose the contents or any information connected with client records without client authorization.