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It’s Time to Brace for ACE

ACE will document transactions involving shipments of export cargo and import cargo in international trade.

It’s Time to Brace for ACE

U.S. Customs recently announced a delay until March 31 for mandatory filing of all entry summary transactions in U.S. Customs’ Automated Commercial Environment (ACE).

ACE is the single window processing of trade that is to automate and enhance interaction between international trade partners, U.S. Customs and Border Protection (CBP), and partner government agencies (PGAs) across the cargo import and export process.

ACE Cargo Release for non-PGA entries will now be mandatory on May 28. The next stage of ACE becomes mandatory in a staggered approach this year. ACE is to be used for all electronic entries and related entry summary filings.

While CBP has just pushed back some mandatory dates, the overall mandatory filing deadline is quickly approaching, and its arrival is going to be bumpy for companies that aren’t ready. If you’re not proactively preparing for the changes, you will need to brace for ACE.

And if you’re thinking all you need to do is wait for your software vendor to say the functionality is ready, and to just switch on and you’ll be automatically compliant, you’re in for a bit of a shock. There’s a learning curve to dealing with ACE. And beyond the software, you’ll have significant operational changes to incorporate into your business. If you haven’t yet filed your first entry, you may experience a rough landing when ACE filings become mandatory.

Even for those who have been using the Automated Commercial System (ACS) for decades, the codes and terminology coming out of Customs for the ACE-driven transactions are different. To keep operating at the same level, uninterrupted, you’ll need to be able to adjust immediately to these changes when things switch over.

ACE Entry Summary has been active for five years, and is pretty stable. The ACE Cargo Release, introduced two years ago, has had a much lower adoption rate. Although that rate has increased from four to 30 percent of eligible transactions in the last year, participation is still not widespread.

When Customs throws the switch this summer, those who are not already well versed in the system may find it takes extra time and extra effort to get up to speed and navigate through the new processes and compliance.

CBP has moved to a staggered approach for making the PGAs mandatory. Starting March 31, two of the agencies that are currently part of the ACS system, APHIS Lacey Act and the Department of Transportation (now referred to as NHTSA), will be mandatory in ACE. The FDA’s new mandatory date is not yet known, neither is the mandatory filing date for the other dozen or so PGAs also coming online.

The number of changes in FDA alone is significant. There are eight different programs within FDA filings now, and brokers need to know which program each product goes into. Then there’s the additional data elements that brokers will now be required to collect, such as brand name, intended use code, and different affirmation of appliance codes. There are also restrictions on when you can replace an entry, particularly if there’s a PGA involved.

By the end of this year, 30 to 40 PGAs may be added to the mix. And even more new data elements will be required to comply with each agency’s requirements.

While ACE itself is a single window, there’s no single window for information. Customs has produced some operational guides, but they’re behind in explaining the specific changes and policy clarifications. For that, you have to investigate each PGA. But even that won’t provide easy answers. For example, the FDA provides only a technical information guide, which is over 300 pages.

Customs is still training its own people, and they are having to deal with the extra workload and new system. Two different calls with the same question are likely to turn up two different CBP replies. It will take practice to pick up knowledge on how to fulfil ACE CR’s new processes. To be more effective, you’ll need to know as much as you can before you call Customs so you can ask the right questions and keep drilling until you get the more definitive answer.

As yet there are no down-to-earth webinars, manuals, or kits from the government agencies explaining how to navigate this new world. The PGAs can give you the specifications but nothing designed specifically to assist the desk level person.

When customs brokers embrace ACE, huge improvements are expected to follow. Rather than sending a runner down to Customs to deliver paper documents, you’ll be able to cancel and replace entries electronically. Rather than waiting on courier deliveries, Customs packets will transfer electronically. If you submit an entry and Customs has a question, instead of finding a note in your box at the Customs house, they will send you the question electronically and you can respond in kind. And it’s all there in the system, regardless of who’s dealing with any one file or importation.

Start practicing the system now, put it through its paces, get used to its rhythm and processes. There are, after all, plenty of eligible transactions that every broker can file right now. Otherwise, with ACE quickly approaching, if your Customs clearance process is not braced for the change, your business could be significantly impacted.

Craig Seelig is WiseTech Global’s product manager for customs and government compliance Americas.

US CBP has extended the deadline for the use of an automated system for recording data on shipments of export cargo and shipments of import cargo in U.S. international trade.

What Does the ACE Deadline Delay Mean for Your Business?

In late August, U.S. Customs and Border Protection announced that the mandatory deadline for filing ACE Entry Summaries and ACE Cargo Release Entries has been delayed from November 1, 2015 to February 28, 2016.

In addition, the only mandatory partner government agency (PGA) data to be filed electronically on February 28 will be for the Food and Drug Administration, the National Highway Traffic Safety Administration, and the United States Department of Agriculture‘s Animal and Plant Health Inspection Service. Data for all other PGAs will be required to be filed electronically only in July of 2016.

The move gives CBP a little more breathing room and an opportunity to make improvements. CBP is still making changes to the functional specifications. CBP uncovered some issues during the PGA pilot process. While this was to be expected, there are adjustments to be made as CBP sees ACE interacting with each PGA.

There are areas where CBP can improve its knowledge to better support the trade. CBP and the PGAs working together to better understand each other’s processes. The delay presents CBP with a tremendous opportunity to better train their own personnel.

For those of us that took ACE seriously and have invested the time, effort, and money into being ready for the November 1, 2015 deadline, the delay is a little disheartening. However, we understand that this was necessary for the greater good.

As of July 2015, only 60 percent of entry summaries were being filed in ACE, and only 10 percent of cargo release was being filed in ACE Cargo Release. About 25 percent of all filers in the U.S. have yet to file an ACE entry summary.

The new deadline gives some relief to those that might have started late but have put effort into implementing ACE-compliant software. It also gives filers a brief window to re-evaluate where their current software provider stands on ACE.

The pressure on the software vendors is not decreasing; it only continues to build. There is still plenty of new work to be done and ACE changes will continue at a rapid pace. More PGAs are being added to the new July 2016 deadline, including FWS and CPSC. New functionality is being introduced into ACE Cargo Release.

The delay gives the trade an extended opportunity to prepare for ACE in another way. Brokers need to take PGA reporting seriously, to understand the additional requirements while there is still time. Some brokers are operating under misconceptions about ACE and the PGA requirements.

A group from the trade is putting together business process documents for the brokers in regards to each PGA. Brokers need to do their homework now and find out the requirements for each PGA. Brokers will likely need to go back to their importers and inform them of the additional data that will be required for every entry from now on. Brokers may also want to look at setting up EDI interfaces with their clients to receive this data electronically or perhaps build up product libraries that can hold this data.

Don’t be fooled into a false sense of relief now that ACE has been pushed back a few months. The delay only gives a minor break to those who are a bit behind. With all of the work still to be done it is not time to take the foot off of the gas.

 

Craig Seelig, is global product manager for customs and compliance Americas at WiseTech, a developer of cloud-based software solutions for the international and domestic logistics.