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R 252157Z NOV 08
FM SECSTATE WASHDC
TO MARITIME SECURITY COLLECTIVE

UNCLAS SECTION 01 OF 02 STATE 125120 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON ETRD EWWT KHLS
SUBJECT: GUIDANCE ON CBP 10+2 RULE 
 
¶1. Summary:  U.S. Customs and Border Protection (CBP) has 
published an interim final rule requiring importers and 
carriers to electronically submit additional information on 
cargo before it is brought into the United States by vessel. 
The rule, also known as "10 2," fulfills the advance data 
requirements of the Security and Accountability for Every 
(SAFE) Port Act of 2006 and is a step in the Department of 
Homeland Security's (DHS) strategy to assess and identify 
high-risk shipments to prevent terrorist weapons and 
materials from entering the United States.  As many trading 
partners and industry representatives have raised concerns 
regarding the impact of these requirements on trade, below is 
background information and points on the current status of 
the rule. 
 
BACKGROUND 
---------- 
 
¶2. On January 2, 2008, CBP published a notice of proposed 
rulemaking in the Federal Register for public comment. 
 
¶3. Following the publication of the proposed rule, CBP 
extended the public comment period to March 18, 2008.  CBP 
has received comments from importers, members of Congress, 
and foreign governments citing concerns with the 
implementation of the rule and potential negative impacts on 
trade.  Some industry representatives have estimated that the 
costs of the rule could reach up to $20 billion annually and 
result in a 2 to 5 day delay in the supply chain.  CBP's 
latest estimates demonstrate potential annualized costs of up 
to $7 billion.  State has received comments from Japan, the 
EU and Brazil echoing the concerns of industry and calling 
for a pilot program.  Also, several trading partners and the 
World Customs Organization have raised concerns with the 
rule's compatibility with the WCO SAFE Framework. 
 
¶4. CBP has engaged with the trade community and other 
executive branch agencies to address these concerns and has 
prepared an interim final rule, which was published on 
November 25, 2008.  The interim final rule will take effect 
60 days after publication.  Pursuant to the interim final 
rule, importers are required to file an Importer Security 
Filing, generally consisting of the following 10 data 
elements 24 hours prior to vessel lading at the foreign port: 
- Manufacturer (or supplier) 
- Seller 
- Buyer 
- Ship to party 
- Container stuffing location 
- Consolidator (stuffer) 
- Importer of record number / FTZ applicant identification 
number 
- Consignee number(s) 
- Country of origin 
- Commodity Harmonized Tariff Schedule of the United States 
(HTSUS) number 
In addition, carriers are required to submit a vessel stow 
plan and container status messages regarding certain events 
relating to containers loaded on vessels destined to the 
United States.  The new requirements apply to the maritime 
cargo environment only. 
 
¶5. CBP has made several significant changes from the proposed 
rule.  The interim final rule provides for a structured 
review and flexible enforcement period, during which CBP will 
show restraint in enforcing the rule, taking into account 
difficulties that importers may face in complying with the 
rule, so long as importers are making satisfactory progress 
toward compliance and are making a good faith effort to 
comply with the rule to the extent of their current ability. 
In addition, the rule provides flexibility with respect to 
the required timing of submission of certain Importer 
Security Filing data elements and how traders interpret these 
elements.  The six data elements with flexibility are: 
manufacturer (or supplier), ship to party, country of origin, 
commodity HTS number, container stuffing location, and 
consolidator.  These flexibilities will allow CBP to conduct 
a structured review of the data elements, including an 
evaluation of any specific compliance difficulties the 
industry may encounter.  CBP 
will gather information through June 1, 2009, by conducting 
reviews of particular importers to determine whether 
submission of all 10 data elements 24 hours before lading is 
feasible.  If it is not, CBP will analyze what barriers the 
importers encountered.  The structured review will cover a 
range of enterprises, from small to large, and will include 
both integrated and nonintegrated supply chains. 
 
¶6.  CBP has invited written comment on the six data elements 
 
STATE 00125120  002 OF 002 
 
 
for which some type of flexibility has been provided and on 
the revised Regulatory Assessment and Final Regulatory 
Flexibility Analysis.  Comments must be received on or before 
June 1, 2009. 
 
¶7. CBP and other agencies, including State, have been heavily 
involved in this process.  CBP will issue specific guidance 
on the details of the data element requirements.  CBP has 
also committed to conduct an extended round of structured 
outreach activities to engage with the trade on all aspects 
of the rule with a series of regional seminars and trade 
round table discussions at all of CBP's major seaports of 
entry and other ports as needed or requested by the trade. 
CBP will also identify trade community operators who have 
established processes (or who have successfully re-engineered 
processes) to deliver the data timely to CBP to provide their 
colleagues in the community with business advice on how to 
comply with the regulatory requirements.  CBP's seminars will 
focus on all topics related to this rule, technical, 
operational, and process components, such as documentation 
adjustments and developing automated solutions to track 
supply chain partners and commodity orders.  All material 
discussed and presented at the seminars will be published on 
the CBP website along with Frequently Asked Questions (FAQs) 
and a general "How to Guide."  As this rule has garnered much 
attention among trading partners, below are background points 
for use in response to inquiries.  Additional information on 
the program as well as the published Federal Register notice 
with detailed information on how to submit comments are 
available on EEB's intranet website at http://eb.state.gov/ 
under Maritime Security Community and at www.cbp.gov. 
 
BACKGROUND POINTS 
----------------- 
 
- The SAFE Port Act of 2006 mandates the development of a 
regulation to require additional data elements for improved 
high-risk targeting, including appropriate security elements 
of entry data to be provided as advanced information prior to 
vessel lading. 
 
- U.S. Customs and Border Protection (CBP) issued a notice of 
proposed rulemaking on January 2, 2008, known as the Importer 
Security Filing and Additional Carrier Requirements or "10 2." 
 
- CBP issued an interim final rule on November 25, 2008.  The 
interim final rule will take effect 60 days after publication. 
 
- This rule will increase the scope and accuracy of 
information gathered on shipments of cargo arriving by vessel 
into the United States. 
 
- Under this rule, importers and carriers will be required to 
submit additional pieces of information in order to enhance 
the security of the maritime environment. 
 
- CBP will continue to consult with the trade community and 
our international trading partners on developments involving 
maritime security and trade facilitation. 
RICE