Background

U.S. Customs and Border Protection has extended for another two years, through August 2023, its pilot program testing the transmission of additional data elements for Section 321 goods in advance of their arrival.

Section 321 of the Tariff Act of 1930 generally exempts from duty and taxes up to $800 worth of goods imported by one person on one day. The growing use of e-commerce has increased the number of such shipments, but CBP has said it is not receiving adequate advance information to assess the security risk of these shipments while still maintaining the clearance speeds the private sector has come to expect.

CBP is therefore conducting the Section 321 data pilot to test the feasibility of (1) obtaining advance information from regulated and non-regulated entities, such as online marketplaces, and (2) requiring additional advance data elements that identify the entity causing the shipment to cross the border, the product in the package, the listed marketplace price, and the final recipient (specific data elements will vary somewhat depending on the transmitting entity). CBP has said it will use this information to improve its ability to identify and target high-risk e-commerce shipments, including for narcotics, counter-proliferation, and health and safety risks, but not for entry or release purposes.

The pilot is currently limited to nine participants, including carriers, brokers, freight forwarders, and online marketplaces. Participants agree to electronically transmit the specified advance data elements regarding Section 321 shipments destined for the U.S. and arriving by any mode of shipment (although shipments designated for a foreign-trade zone remain excluded). Moreover, CBP has given participants the flexibility to transmit optional data elements as they are able to test the viability of sharing additional information.

After the end of the pilot, CBP will determine whether to further extend and/or expand it or make additional advance reporting requirements mandatory in the e-commerce environment.

For more information on e-commerce and/or the Section 321 pilot, please contact attorney Lenny Feldman at (305) 894-1011 or via email.

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