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Customs service advances automated export/import processing: ACE system intends to facilitate U.S. trade.

Good news for U.S. companies with large export markets in Mexico and Canada! After a lengthy suspension needed to fix several technical glitches, the U.S. Customs and Border Protection (CBP or Customs) agency announced in late January that it has reinstated testing of its electronic truck manifest filing system at the port of Blaine, WA. CBP still plans to deploy this technology, developed as part of its larger Automated Commercial Environment (ACE) initiative, to several other major border crossings later this year.

And, for those who have been waiting for CBP to move into the 21st century by updating the way that it processes trucks at northern and southern borders, these announcements are especially good news. CBP has also announced that it is moving full steam ahead with the implementation of its Automated Commercial Environment--or ACE--program.

According to Customs, ACE is nothing less than a system that will "revolutionize" how CBP handles all shipments going in and out of the U.S. by "providing an integrated, fully automated information system to enable the efficient collection, processing and analysis of commercial import and export data." Big news for nonwovens producers who are trading between the U.S., Canada, Mexico and beyond.

But just how exactly will the system work? And, what sort of timeline can be expected for the program's implementation? Before tackling these questions, it is important to review some of the history that lead to the development of the ACE system.

Initiated By Congress

The Automated Commercial Environment actually has its roots in legislation that was passed by Congress to implement the North American Free Trade Agreement (NAFTA) back in 1993. In Title VI of the legislation (which is informally referred to as the "Customs Modernization Act,"), Congress instructed Customs to increase its efficiency at processing imports, highlighting the importance of using electronic processing and waiving certain existing mandated paper filing requirements.

Customs answered this call in 1994 through a major initiative to modernize the agency and its processes. One of the first projects announced by Customs was the development of a system to replace the Automated Commercial System (ACS), a paper-based and transaction-oriented processing system that many NONWOVENS INDUSTRY readers have likely encountered at one time or another. Considered to be state-of-the-art when it was first developed in 1984, the ACS was already beginning to show its limitations, so Customs began work on an updated version that would "enable the efficient collection, processing and analysis of commercial import and export data."

But early efforts were criticized by the General Accounting Office (GAO, the investigative arm of Congress) due to mismanagement and "significant flaws" that GAO found in the technology. This led to reduced funding from Congress with the end result being that the project languished in bureaucratic purgatory for several years.

In the meantime, however, the ACS continued to show increased evidence of its age and deterioration, experiencing frequent brownouts and blackouts, which often required shipping transactions to be completed by hand. Frustrated, more than a dozen trade groups banded together in the late 1990's to press Congress to fund the updated system. Their efforts did not go unnoticed, and in fall 2000, Congress approved $130 million for ACE development.

One year later, following the September 11 terrorist attacks, Congress placed greater emphasis on Customs modernization as a means of safeguarding U.S. borders and set aside $300 million in funding for ACE. Congress has also allocated roughly the same amount to Customs each year to speed implementation of the ACE system. Increased funding brought new life into the program and allowed CBP to begin demonstrating the ACE Systems' capabilities in 2003 by launching the first of seven "releases" of ACE development. During the first release, CBP implemented the infrastructure and during the second release ACE's Secure Data Portal was introduced. This portal is a customized computer screen, which allows users to access certain import and bond data, run reports and communicate with Customs.

Last year, CBP rolled out ACE's third release--a Periodic Monthly Statement function that allows participants to pay duties, taxes and fees on a monthly basis, as opposed to the traditional transaction-by-transaction basis. In explaining the significance of this release, CBP Commissioner Frank Bonner noted that "For the first time in 215 years, importers and brokers [in the U.S.] can make a single monthly duty payment on all imported goods instead of paying duties on them one entry at a time."

CBP's fourth release was the launch of automated commercial truck processing capabilities at the port of Blaine. This release was particularly significant to cross-border trucking companies because, unlike ocean, air and rail carriers, truckers had previously not been permitted to submit manifest information electronically. And, during the next 12 months CBP says it will deploy ACE to all land border ports of entry that process commercial traffic with the next pilot test scheduled for launch at the border-crossing in Buffalo, NY sometime within the next several months.

Although details of the last three releases are still somewhat vague, Release 5 is expected to expand the account management features that were part of Release 3 when it is issued later this year. Releases 6 and 7, which Customs plans to introduce between 2007 and 2010, are expected to complete the cargo management process by adding full entry processing and cargo release functionality. According to Customs, this will allow the ACE system to provide foreign trade zone and warehouse support, export processing and a number of other functions.

Beyond all of these existing and future functionalities, one of the greatest assets of the ACE system is its adaptability. As Louis Samenfink, executive director of CBP's Modernization Office, noted the ACE system was "built to change as business processes do." When fully implemented, for example, the ACE system will be able to integrate changing import requirements accompanying new free trade agreements. Additionally, the ACE system will also house the International Trade Data System (ITDS), a single system interface between the trade community and federal government that will allow for sharing of trade related data across more than 100 federal agencies that are involved in international trade.

Getting Involved

CBP is presently encouraging all interested importers, brokers and carriers to apply for ACE accounts to enjoy features such as the periodic monthly statement system, the secure data portal and streamlined truck processing, and to ensure a smooth transition when ACE participation is eventually made mandatory. Additionally, CBP made the relatively simple application process even easier on February 1 by announcing that it was waiving a previous eligibility requirement of participation in the Customs-Trade Partnership Against Terrorism (C-TPAT) program to encourage involvement.

For more information about how to establish an ACE account, e-mail CBP at acenow@dhs.gov. You may also check for the latest updates for ACE application information on the CBP website at www.cbp.gov/modernization/.

Peter Mayberry

INDA Director of Government Afairs

and

Jessica Franken

INDA Goverment Affairs Associate
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Title Annotation:Capitol Comments; Automated Commercial Environment
Comment:Customs service advances automated export/import processing: ACE system intends to facilitate U.S. trade.(Capitol Comments)(Automated Commercial Environment)
Author:Mayberry, Peter; Franken, Jessica
Publication:Nonwovens Industry
Geographic Code:1USA
Date:Mar 1, 2005
Words:1157
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