The United States Customs & Border Protection Agency (CBP) deployed a test of a new informal type of entry on September 28, 2019. The new entry known as “Type 86” covers entry for low-value Section 321 shipments. According to CBP, the entry type is expected to enhance security and safety for imports by offering the agency better visibility into low-value shipments. While a full rollout is expected, the current deployment is a test and is therefore not mandatory for users.
Why Did CBP Create an Entry Type 86?
Section 321 shipments started with the Tariff Act of 1930, Section 321 allows for the import of goods without the payment of taxes and duty by a company or individual, if the retail value of the consignment in the country of origin is less than $800 in value. Any trader bringing in Section 321 shipments will typically have to submit their bill of lading or a manifest with a list of every shipment in what is called “release on manifest” process. Currently, ACE (Automated Commercial Environment) supports release on the manifest using Section 321 for truck or air shipments. Type 86 can be used by any mode of transport and includes use for release if there are PGA (Participating Government Agencies) requirements.
Section 321 Type 86 provides a more efficient and less complicated release and entry process for low-value Section 321 shipments. Unlike the Type 11 informal entry or the formal entry, this type of informal entry applies to low-value shipments that have to adhere to PGA data requirements. Moreover, the release of the cargo using Type 86 is electronic and supports remote filing to expedite the clearance of low-value Section 321 consignments.
Benefits of Section 321 “Type 86” Clearance
- Traders will increase efficiency through the Automated Broker Interface (ABI) which is used to transmit consignee and/or importer information and receive electronic release messages for their low-value shipments.
- Industry participants and the CBP get access to ACE Reports and this enhances the effectiveness of processes for both parties, thus facilitating legitimate trade.
- Entry type 86 will allow ABI Self Filers and Customs Brokers to file data required by Partner Government Agencies (PGA) for any shipments with a value of $800 or less.
- It makes the work of the CBP in locating, targeting and examining low-value Section 321 shipments easier through the collection of the necessary data.
- The Type 86 informal entry makes it easier for PGAs to identify products or consignments that violate the rules. They can thus use the Type 86 entry type for enforcement, targeting or reporting purposes while reducing the complexity of the entry processes.
Other Benefits include:
- Enhancing the capacity of the CBP to target inbound consignments based on the risk profile
- Assuring supply chain security
- Protecting intellectual property rights
- Enforcing trade laws
Who can participate and what is Required of Filers
The ACE Entry Type 86 is open to importers and designated custom brokers working with low-value Section 321 shipments, including shipments imported through any mode of transport, and those subject to the requirements of Partner Government Agencies.
Under this Type 86 entry, the purchaser, owner or customs broker appointed by the consignee, purchaser or owner has to submit the following information to the CBP either before arrival, upon arrival but no later than 15 days after the cargo arrives at the port of entry:
- The air waybill number or the bill of lading
- 10 digit HTS number
- Entry number
- Fair retail value of the goods in the country of shipment
- Planned port of entry
- Shipper name, country, and address
- Country of origin
- Consignee name and address
- Importer of Record (IOR) number of the broker, purchaser, or owner when designated by a consignee
Note that traders will be required to provide an IOR number if their shipments are subject to the reporting requirements of partner government agencies.
The Process for Filing under Entry Type 86
Since the ACE Entry Type 86 deployment is still in test mode, CBP requires that all consignees that intend to file the informal entry type 86 do it via a customs broker who will be the importer of record for the consignment. This is as opposed to regular Section 321 regulations that mandate that submissions may be made by either the carrier, purchaser, consignee, owner of the shipment or licensed customs broker legally designated by any of these persons.
Requirements For Filers under ACE Entry Type 86
- Customs brokers have to be compliant with applicable regulatory or statutory requirements and be designated by the relevant party to submit documentation and data via a legal power of attorney agreement.
- Customs brokers must have an electronic Automated Broker Interface (ABI) connection to CBP. It is through tABI that they will submit the data for the informal entry type 86 to CBP
- Participation in the Automated Broker Interface system requires that filers adhere to the procedures and meet the technical requirements laid out in the Customs and Trade Automated Interface Requirements (CATAIR).
Important Things to Note
- Entry summary and bond documentation are generally not required with an informal entry type 86.
- The importing party does not have to pay merchandise processing fees for low-value Section 321 shipments released under entry type 86.
- Any shipments that are required to pay any applicable partner government agency taxes, fees, and duties under any regulation or statute imposed by other agencies on imports will not be deemed as a low-value Section 321 shipment.
- Any filing under this entry type that the CBP determines to be eligible for any taxes, duties or fees will need to be refiled through the relevant formal or informal entry processes.
- The CBP may ask filers to submit data for shipments under the formal entry for purposes of revenue protection, import admissibility enforcement purposes, and efficiency in the running of customs processes.