Definition of Importer Security Filing Importer, 43961-43965 [2016-15687]

Download as PDF Federal Register / Vol. 81, No. 129 / Wednesday, July 6, 2016 / Proposed Rules www.regulations.gov as well as enter the comment submissions into ADAMS. The NRC does not routinely edit comment submissions to remove identifying or contact information. If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submission. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment submissions into ADAMS. Dated at Rockville, Maryland, this 28th day of June, 2016. For the Nuclear Regulatory Commission, Andrea L. Kock, Deputy Director, Division of Decommissioning, Uranium Recovery and Waste Programs, Office of Nuclear Material Safety and Safeguards. [FR Doc. 2016–15949 Filed 7–5–16; 8:45 am] BILLING CODE 7590–01–P DEPARTMENT OF HOMELAND SECURITY U.S. Customs and Border Protection 19 CFR Part 149 [USCBP–2016–0040] RIN 1651–AA98 Definition of Importer Security Filing Importer U.S. Customs and Border Protection, DHS. ACTION: Notice of proposed rulemaking. AGENCY: The Importer Security Filing and Additional Carrier Requirements regulations were implemented in 2009 as an interim final rule to improve CBP’s ability to identify high-risk shipments in order to prevent smuggling and improve cargo safety and security. These regulations require certain cargo information to be submitted to CBP via an Importer Security Filing (ISF) before the cargo is loaded on a vessel that is destined to the United States. These regulations fulfill the requirements of section 203 of the SAFE Port Act of 2006 and section 343 of the Trade Act of 2002, as amended by the Maritime Transportation Security Act of 2002. The ISF Importer is the party that is required to file the ISF. This notice of proposed rulemaking (NPRM) proposes to expand the definition of ISF Importer ehiers on DSK5VPTVN1PROD with PROPOSALS SUMMARY: VerDate Sep<11>2014 13:12 Jul 05, 2016 Jkt 238001 for certain types of shipments to ensure that the party that has the best access to the required information will be the party that is responsible for filing the ISF. DATES: Comments must be received on or before September 6, 2016. FOR FURTHER INFORMATION CONTACT: Peyman Jamshidi, Program Manager, Vessel Manifest and Importer Security Filing, Office of Cargo and Conveyance Security, Office of Field Operations by email at: PEYMAN.JAMSHIDI@ cbp.dhs.gov. ADDRESSES: You may submit comments, identified by docket number, by one of the following methods: • Federal eRulemaking Portal: http:// www.regulations.gov. Follow the instructions for submitting comments via docket number USCBP–2016–0040. • Mail: Border Security Regulations Branch, Regulations and Rulings, Office of International Trade, U.S. Customs and Border Protection, 90 K Street NE., 10th Floor, Washington, DC 20229– 1177. Instructions: All submissions received must include the agency name and docket number for this rulemaking. All comments received will be posted without change to http:// www.regulations.gov, including any personal information provided. For detailed instructions on submitting comments and additional information on the rulemaking process, see the ‘‘Public Participation’’ heading of the SUPPLEMENTARY INFORMATION section of this document. Docket: For access to the docket to read background documents or comments received, go to http:// www.regulations.gov. Submitted comments may also be inspected during regular business days between the hours of 9:00 a.m. and 4:30 p.m. at the Office of International Trade, Regulations and Rulings, U.S. Customs and Border Protection, 90 K Street NE., 10th Floor, Washington, DC 20229–1177. Arrangements to inspect submitted comments should be made in advance by calling Mr. Joseph Clark at (202) 325– 0118. SUPPLEMENTARY INFORMATION: Background After the terrorist attacks on September 11, 2001, CBP amended its regulations to require vessel carriers to electronically submit certain advance cargo information, including cargo declarations, to CBP no later than 24 hours before the cargo is laden aboard a vessel at a foreign port. See 19 CFR 4.7 and 4.7a. The rule was published in the Federal Register (67 FR 66318) on PO 00000 Frm 00003 Fmt 4702 Sfmt 4702 43961 October 31, 2002. Its purpose was to enable CBP to identify high-risk cargo before the vessel arrived in the United States. Section 203 of the Security and Accountability for Every Port Act of 2006 (Pub. L. 109–347, 120 Stat. 1884 (SAFE Port Act)) directed the Secretary of Homeland Security, acting through the Commissioner of CBP, to promulgate regulations to ‘‘require the electronic transmission to the Department [of Homeland Security] of additional data elements for improved high-risk targeting, including appropriate security elements of entry data, as determined by the Secretary, to be provided as advanced information with respect to cargo destined for importation into the United States prior to loading of such cargo on vessels at foreign seaports.’’ Pursuant to this Act, and section 343(a) of the Trade Act of 2002 (19 U.S.C. 2071 note), CBP published an NPRM in the Federal Register on January 2, 2008 (73 FR 90), proposing to require importers and carriers to submit additional information pertaining to maritime cargo before the cargo is loaded on a vessel that is destined to the United States. The trade gave the proposed rule the shorthand name ‘‘10 + 2’’, which references the number of advance data elements CBP was proposing to collect. Importers, described in the proposed rule as Importer Security Filing Importers, would generally be required to submit 10 additional data elements (the 10 of ‘‘10 + 2’’). Carriers would generally be required to submit two additional data elements (the 2 of ‘‘10 + 2’’). On November 25, 2008, CBP published an interim final rule and solicitation of comments in the Federal Register (73 FR 71730, CBP Decision 08–46). The interim final rule was effective on January 26, 2009. However, a delayed compliance period of at least 12 months was provided to allow industry sufficient time to comply with the new requirements. The interim final rule finalized most of the provisions of the NPRM, including all the provisions relating to the carrier requirements. The only portions of the NPRM that were not finalized were the six importer data elements for which CBP provided some flexibility regarding the time and/or manner of compliance. CBP solicited public comments on the flexibilities provided. CBP also invited comments on the revised Regulatory Assessment and Final Regulatory Flexibility Analysis. CBP has not yet published a final rule addressing the flexibilities and the Regulatory Assessment and Final Regulatory Flexibility Analysis. E:\FR\FM\06JYP1.SGM 06JYP1 43962 Federal Register / Vol. 81, No. 129 / Wednesday, July 6, 2016 / Proposed Rules I. Summary of ISF Importer Requirements T&E shipments and for goods to be delivered to a FTZ. The interim final rule added a new part 149 to the CBP regulations, entitled Importer Security Filing. The Importer Security Filing regulations require ISF Importers, as defined in 19 CFR 149.1, to transmit an ISF to CBP, for cargo other than foreign cargo remaining on board (FROB), no later than 24 hours before cargo is laden aboard a vessel destined to the United States. The transmission of the ISF filing for FROB is required any time prior to lading. ISF Importers, or their agents, must submit 10 data elements to CBP for shipments consisting of goods intended to be entered into the United States and goods intended to be delivered to a foreign trade zone (FTZ). See 19 CFR 149.3(a). ISF Importers, or their agents, must submit five data elements to CBP for shipments consisting entirely of FROB and shipments consisting entirely of goods intended to be transported as Immediate Exportation (IE) or Transportation and Exportation (T&E) in-bond shipments. See 19 CFR 149.3(b). 1. Foreign Cargo Remaining on Board (FROB) Under the current definition, the ISF Importer for FROB shipments is the carrier. The interim final rule clarified that the carrier means the international carrier arriving in the United States, i.e., vessel operating carrier. See 73 FR 71743. The rationale for requiring the vessel operating carrier to provide the ISF for FROB shipments was that ultimately it is the vessel operating carrier that decides to transport the cargo to the United States. There is still much debate within the shipping community about who should be the ISF importer for FROB shipments. This debate stems from the relationship between vessel operating carriers and non-vessel operating common carriers (NVOCCs).1 When a party wants to ship goods on a vessel, the party can either book the shipment directly with the vessel operating carrier or it can use an NVOCC who acts as an intermediary between the party shipping the goods and the vessel operating carrier. When a party books a FROB shipment directly with a vessel operating carrier, the vessel operating carrier has direct access to the required ISF data and is able to file the ISF information with CBP. However, when a party uses an NVOCC, the vessel operating carrier frequently does not have access to the required ISF data elements. This is because the NVOCC may not want to share confidential business information with the vessel operating carrier, a potential competitor. However, under the current definition of ISF Importer, the vessel operating carrier is always the ISF Importer for FROB shipments, even though it may not have access to the required information. In response to comments to the interim final rule, CBP addressed the issue of the NVOCC not sharing necessary ISF information with the vessel operating carrier by clarifying that the NVOCC can submit the ISF directly to CBP, if it does so as the vessel operating carrier’s agent. See 73 FR 71744. Based on CBP’s experience with the ISF program, CBP has concluded that the procedure of having the NVOCC act as the agent of the vessel operating carrier for FROB shipments is not effective. The current requirement ehiers on DSK5VPTVN1PROD with PROPOSALS II. Proposed Amendment This rulemaking proposes to expand the definition of the Importer Security Filing (ISF) Importer. Currently, an ISF Importer is generally defined in 19 CFR 149.1 as the party causing goods to arrive within the limits of a port in the United States by vessel. The regulation provides that generally the ISF Importer is the goods’ owner, purchaser, consignee, or agent such as a licensed customs broker. However, the regulation limits the definition of ISF Importer to certain named parties for foreign cargo remaining on board (FROB), immediate exportation (IE), and transportation and exportation (T&E) inbond shipments, and for merchandise being entered into a foreign trade zone (FTZ). For FROB cargo, the regulation provides that the ISF Importer is the carrier; for IE and T&E in-bond shipments, and goods to be delivered to an FTZ, the regulation provides that the ISF Importer is the party filing the IE, T&E, or FTZ documentation. Based on input from the trade as well as CBP’s analysis, CBP has concluded that these limitations do not reflect commercial reality and, in some cases, designate a party as the ISF Importer even though that party has no commercial interest in the shipment and limited access to the ISF data. Therefore, as explained below, CBP is proposing to expand the definition of ISF Importer for FROB cargo, for IE and VerDate Sep<11>2014 13:12 Jul 05, 2016 Jkt 238001 1 A non-vessel operating common carrier (NVOCC) means a common carrier that does not operate the vessels by which the ocean transportation is provided, and is a shipper in its relationship with an ocean common carrier. See 19 CFR 4.7(b)(3)(ii). PO 00000 Frm 00004 Fmt 4702 Sfmt 4702 has not facilitated the sharing of necessary ISF information between NVOCCs and vessel operating carriers and has not resulted in the filing of accurate information. Rather, this procedure has resulted in unclear lines of responsibility and has hampered CBP’s enforcement of the ISF requirements. In an effort to increase compliance and to ensure that the party that has direct access to ISF information is the party responsible for submitting the ISF to CBP, CBP is proposing to broaden the definition of an ISF Importer for FROB shipments to include NVOCCs. This change is consistent with the requirement of the SAFE Port Act, which provides that a requirement to provide information will be imposed on the party most likely to have direct knowledge of that information.2 Broadening the definition of ISF Importer to include NVOCCs is also consistent with the general definition that the ISF Importer means the party causing the goods to arrive within the limits of a port in the United States by vessel. The NVOCC acts as the party booking the shipment aboard the carrier and typically has advance knowledge of the voyage’s itinerary, i.e., whether the vessel will enter a U.S. port. By booking the shipment, the NVOCC is the party causing the goods to arrive in the United States. In these instances, not only will the NVOCC be the party most able to obtain the required ISF information, but it will be the party that causes the goods to arrive within the limits of a port in the United States as FROB cargo. In some circumstances, the vessel operating carrier would be the party that causes the goods to arrive in the United States despite the NVOCC having booked the shipment. An example would be when an NVOCC books a shipment not initially scheduled to arrive in the United States, but the vessel is diverted to the United States by the vessel operating carrier. If the cargo remains on board the vessel at the U.S. port and is not discharged until it arrives at the originally scheduled foreign destination port, this would 2 The SAFE Port Act requires CBP to follow the parameters listed in the Trade Act of 2002, which provides that ‘‘the requirement to provide particular information shall be imposed on the party most likely to have direct knowledge of that information. Where requiring information from the party with direct knowledge of that information is not practicable, the regulations shall take into account how, under ordinary commercial practices, information is acquired by the party on which the requirement is imposed, and whether and how such party is able to verify the information. Where information is not reasonably verifiable by the party on which a requirement is imposed, the regulations shall permit that party to transmit information on the basis of what it reasonably believes to be true.’’ E:\FR\FM\06JYP1.SGM 06JYP1 Federal Register / Vol. 81, No. 129 / Wednesday, July 6, 2016 / Proposed Rules create FROB cargo. In this situation, the vessel operating carrier would be the party that caused the cargo to arrive in the United States and thus the party responsible for filing the ISF. ehiers on DSK5VPTVN1PROD with PROPOSALS 2. IE, T&E, and FTZ Cargo As provided in 19 CFR 149.1(a), the ISF Importer for IE and T&E in-bond shipments and for shipments of goods to be delivered to an FTZ is the party that files the IE, T&E, or FTZ documentation with CBP. CBP believes that this definition needs to be broadened because often the party responsible for filing the ISF did not cause the goods to arrive within the limits of a port in the United States, but is a commercially disinterested party at the time of filing and/or may not have access to the required ISF data. IE and T&E entries are frequently not filed until after the cargo has arrived within limits of a port in the United States. Therefore, there is not yet a party that files the IE or T&E documentation 24 hours prior to lading. In some cases, the party that will be responsible for filing the ISF has not yet been identified. In addition, in some cases, the party that will file the IE or T&E documentation has no commercial interest in the underlying merchandise and that party is a commercially disinterested party 24 hours prior to lading. In these cases, the party filing the IE or T&E entries with CBP did not cause the goods to arrive within the limits of a port in the United States and is not the party most likely to have direct knowledge of the required information. To address this problem, the goods’ owner, purchaser, consignee, or agent such as a licensed customs broker will commonly file the ISF–10 required for shipments intended to be entered into the United States, which consists of 10 data elements, as opposed to the ISF–5 required for IE and T&E shipments, which consists of five data elements. Similarly, for goods being entered into an FTZ, the party filing the FTZ documentation is frequently a commercially disinterested party and/or is not the party most able to obtain the required information. For example, it is common for the FTZ operator to file the FTZ documentation with CBP. However, the FTZ operator is commonly not the party causing the goods to enter the limits of the port in the United States and is a commercially disinterested party 24 hours prior to lading. As a result, the party responsible for filing the ISF is not the party most likely to have direct knowledge of the required information. VerDate Sep<11>2014 13:12 Jul 05, 2016 Jkt 238001 To address these issues, CBP is proposing to expand the definition of ISF Importer for IE and T&E in-bond shipments, and for goods to be delivered to an FTZ, to also include the goods’ owner, purchaser, consignee, or agent such as a licensed customs broker. These are the same parties that are currently included within the definition of ISF Importer for all shipments other than FROB, IE and T&E in-bond shipments, and goods to be delivered to a FTZ. By broadening the definition to include these parties, the responsibility to file the ISF for IE, T&E, and FTZ shipments will be with the party causing the goods to enter the limits of a port in the United States and most likely to have access to the required ISF information and not with a commercially disinterested party. III. Regulatory Analysis A. Executive Orders 12866 and 13563 Executive Orders 13563 and 12866 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This proposed rule is a ‘‘significant regulatory action,’’ although not an economically significant regulatory action, under section 3(f) of Executive Order 12866. Accordingly, the Office of Management and Budget has reviewed this proposed regulation. Under current regulations, the party required to submit ISF is the party causing the goods to enter the limits of a port in the United States. However, the regulation limits the definition for FROB, IE, and T&E shipments as well as for merchandise being entered into a FTZ to certain named parties. Based on input from the trade as well as CBP’s analysis, CBP has concluded that these limitations do not reflect commercial reality and, in some cases, designate a party as the ISF Importer even though that party has no commercial interest in the shipment and limited access to the ISF data. In some cases, the party responsible may not even be involved in the importation at the time the ISF must be filed. This causes confusion in the trade as to who is responsible for filing the ISF and raises confidentiality concerns as sometimes the private party with the information gives the PO 00000 Frm 00005 Fmt 4702 Sfmt 4702 43963 information to the ISF importer who then sends it to CBP. Therefore, CBP is proposing to expand the definition of ISF Importer for FROB cargo, for IE and T&E shipments and for goods to be delivered to a FTZ. This change is consistent with the requirement of the SAFE Port Act, which provides that the requirement to file the ISF will be imposed on the party most likely to have direct knowledge of that information. This proposed rule would modify the definition of the ISF Importer for FROB cargo, for IE and T&E shipments, and for goods to be delivered to a FTZ. The current definition causes confusion and confidentiality concerns. The current ISF Importer for FROB shipments is the vessel operating carrier. In cases where the shipper uses an intermediary, i.e., NVOCC, the vessel operating carrier does not have access to certain of the required elements for confidentiality reasons—only the intermediary has this information. In most cases, the NVOCC chooses to file this information directly to CBP, sidestepping the confidentiality concerns, but the legal burden is on the vessel operating carrier so some NVOCCs feel pressured to share this information with the carrier. This regulation would define the ISF Importer for FROB cargo as the vessel operating carrier or the NVOCC. Under this regulation, the NVOCC, rather than the vessel operating carrier, would be the ISF Importer if it is the party in possession of the required information. Likewise, the definition of ISF Importer causes confusion for IE and T&E cargo. The ISF Importer in these cases is the filer of the IE or T&E documentation. This causes confusion because the IE or T&E documentation often is not created until the cargo arrives in the United States. By contrast, ISF information must be submitted at least 24 hours prior to lading. The proposed rule would expand the definition of ISF Importer for IE and T&E in-bond shipments to also include the goods’ owner, purchaser, consignee, or agent such as a licensed customs broker. The proposed rule would also make a similar change to the definition of the ISF Importer of FTZ cargo. With this change, the ISF Importer will be a party with a bona fide interest in the commercial shipment and access to the required data. The modification of the definition of ISF Importer will simply shift the legal responsibility in some cases for filing the ISF from one party to another for a subset of the total cargo (FROB; IE and T&E; and FTZ cargo). For IE, T&E, and FTZ cargo, the party who is currently required to file the data may not yet E:\FR\FM\06JYP1.SGM 06JYP1 43964 Federal Register / Vol. 81, No. 129 / Wednesday, July 6, 2016 / Proposed Rules ehiers on DSK5VPTVN1PROD with PROPOSALS even be involved in the transaction at the time the data must be submitted. In these cases another party that has the data such as the owner, purchaser, consignee, or agent often files the data, though they are not legally obligated to file it. Under this proposed rule, these parties who have the data will be included in the definition of the party responsible for filing the data. Since these parties are generally the ones currently submitting this data to CBP, this change will have no significant impact. In some rare instances, this proposed rule may shift the burden of filing from one party to another. For example, since the party currently responsible for filing may not be involved in the transaction at the time the data must be submitted, it could be one of several parties (e.g., the owner, purchaser, consignee, or agent) that actually submits the information. Once this proposed rule is in effect, there will be clarity as to which party is responsible, which could change who actually submits the data. In the vast majority of cases, there will be no change in who submits the data, but it is possible that there will be a change. To the extent that there is a change in who actually submits the ISF data, there will be a shift in the time burden to do so from one party to the other. CBP estimates that submitting this information takes 2.19 hours at a cost of $50.14 per hour.3 This loaded wage rate was estimated by multiplying the Bureau of Labor Statistics’ (BLS) 2014 median hourly wage rate for Ship and Boat Captains and Operators ($32.73) by the ratio of BLS’ average 2014 total compensation to wages and salaries for Transportation and Material Moving occupations (1.5319), the assumed occupational group for ship and boat captains and operators, to account for non-salary employee benefits.4 5 3 This differs from the estimated wage rate on the most recent supporting statement for this information collection: OMB Control Number 1651– 0001, available at: http://www.reginfo.gov/public/ do/PRAViewDocument?ref_nbr=201506-1651-003, which is based on outdated data. We will update the wage rate in this supporting statement the next time the ICR is renewed. 4 Source of median wage rate: U.S. Bureau of Labor Statistics. Occupational Employment Statistics, ‘‘May 2014 National Occupational Employment and Wage Estimates, United States— Median Hourly Wage by Occupation Code: 53– 5020.’’ Updated March 25, 2015. Available at http:// www.bls.gov/oes/2014/may/oes_nat.htm#53-0000. Accessed June 15, 2015. 5 The total compensation to wages and salaries ratio is equal to the calculated average of the 2014 quarterly estimates (shown under Mar., June, Sep., Dec.) of the total compensation cost per hour worked for Transportation and Material Moving occupations (26.62) divided by the calculated average of the 2014 quarterly estimates (shown under Mar., June, Sep., Dec.) of wages and salaries VerDate Sep<11>2014 13:12 Jul 05, 2016 Jkt 238001 Therefore, to the extent this proposed rule shifts the reporting burden from one party to the other, there will be a corresponding shift of $109.81 in opportunity cost per filing. CBP lacks data showing how often there would be a shift in the actual reporting burden as a result of this rule but it believes it to be very small and possibly zero. CBP requests comment on this matter. For FROB, the ISF Importer must currently either obtain the information from a third party that has the necessary information or ask that the third party file the information directly to CBP. In some cases, the third party shares this information with the ISF Importer, but it usually files the data directly with CBP for confidentiality reasons. Under the proposed regulation, the party that has access to the ISF information would submit it directly to CBP. Since this third party is generally already providing the ISF information through the current ISF Importer or directly to CBP, this rule will not add a significant burden to these entities. As described above, to the extent that this rule shifts the reporting burden from one party to the other, there will be a corresponding shift of $109.81 in opportunity cost per filing. CBP lacks data showing how often there would be a shift in the actual reporting burden as a result of this rule but it believes it to be very small and possibly zero. CBP requests comment on this matter. This proposed rule benefits all parties by eliminating the confusion surrounding the responsibility for the submission of ISF information. In addition, this rule would significantly reduce confidentiality concerns that may be caused by the current requirements. This rule would ensure the party with the best access to the information is the party who files the information, which will improve the accuracy of the information CBP uses for targeting. Finally, eliminating a step in the transmission process (sending the ISF information from the third party to the current ISF importer) will result in CBP getting the information sooner. Any extra time can be used for more extensive targeting. cost per hour worked for the same occupation category (17.3775). Source of total compensation to wages and salaries ratio data: U.S. Bureau of Labor Statistics. Employer Costs for Employee Compensation. Employer Costs for Employee Compensation Historical Listing March 2004— December 2015, ‘‘Table 3. Civilian workers, by occupational group: Employer costs per hours worked for employee compensation and costs as a percentage of total compensation, 2004–2015 by Respondent Type: Transportation and material moving occupations.’’ June 10, 2015. Available at http://www.bls.gov/ncs/ect/sp/ececqrtn.pdf. Accessed June 15, 2015. PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 B. Regulatory Flexibility Act This section examines the impact of the rulemaking on small entities as required by the Regulatory Flexibility Act (5 U.S.C. 603), as amended by the Small Business Regulatory Enforcement and Fairness Act of 1996. A small entity may be a small business (defined as any independently owned and operated business not dominant in its field that qualifies as a small business per the Small Business Act); a small not-forprofit organization; or a small governmental jurisdiction (locality with fewer than 50,000 people). In the Interim Final Rule establishing the ISF requirements (73 FR 71730; November 25, 2008, CBP Decision 08– 46; Docket Number USCBP–2007–0077), CBP concluded that many importers of containerized cargo are small entities. The rule could affect any importer of containerized cargo so it could have an impact on a substantial number of small entities. This impact, however, is very small. The modification of the definition of ISF Importer will simply shift the legal responsibility in some cases for filing the ISF from one party to another for a subset of the total cargo (FROB; IE and T&E; and FTZ cargo). For IE, T&E, and FTZ cargo, the party who is currently required to file the data may not yet even be involved in the transaction at the time the data must be submitted. In these cases another party such as the owner, purchaser, consignee, or agent often files the data, though they are not legally obligated to file it. Under this proposed rule, these parties will be included in the definition of the party responsible for filing the data. Since these parties are currently submitting this data to CBP, this change will have no significant impact. For FROB, the ISF Importer must currently either obtain the information from a third party that has the necessary information or ask that the third party file the information directly to CBP. In some cases, the third party shares this information with the ISF Importer, but it usually files the data directly with CBP for confidentiality reasons. Under the proposed regulation, CBP is expanding the definition of ISF Importer so that the party that has access to the ISF information would submit it directly to CBP as the ISF Importer. Since this third party is already providing the ISF information through the current ISF Importer or directly to CBP, this proposed rule will not add a significant burden to these entities. For these reasons, CBP certifies that this rule will not have a significant E:\FR\FM\06JYP1.SGM 06JYP1 Federal Register / Vol. 81, No. 129 / Wednesday, July 6, 2016 / Proposed Rules economic impact on a substantial number of small entities. C. Unfunded Mandates Reform Act of 1995 Title II of the Unfunded Mandate Reform Act of 1995 (UMRA) requires agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. This proposed rule is exempt from these requirements under 2 U.S.C. 1503 (Exclusions) which states that UMRA ‘‘shall not apply to any provision in a bill, joint resolution, amendment, motion, or conference report before Congress and any provision in a proposed or final Federal regulation that is necessary for the national security or the ratification or implementation of international treaty obligations.’’ D. Paperwork Reduction Act In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), an agency may not conduct, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number assigned by OMB. The collections of information related to this NPRM are approved by OMB under collection 1651–0001. List of Subjects in 19 CFR Part 149 Arrival, Declarations, Customs duties and inspection, Freight, Importers, Imports, Merchandise, Reporting and recordkeeping requirements, Shipping, Vessels. Proposed Amendment to the Regulations For the reasons stated in the preamble, DHS proposes to amend part 149 of title 19 of the Code of Federal Regulations (19 CFR part 149), as set forth below: PART 149—IMPORTER SECURITY FILING 1. The authority citation for part 149 continues to read as follows: ■ Authority: 5 U.S.C. 301; 6 U.S.C. 943; 19 U.S.C. 66, 1624, 2071 note. 2. Section 149.1(a) is revised to read as follows: ■ ehiers on DSK5VPTVN1PROD with PROPOSALS § 149.1 Definitions. (a) Importer Security Filing Importer. For purposes of this part, Importer Security Filing Importer (ISF Importer) means the party causing goods to arrive within the limits of a port in the United States by vessel. For shipments other than foreign cargo remaining on board (FROB), the ISF Importer will be the goods’ owner, purchaser, consignee, or VerDate Sep<11>2014 13:12 Jul 05, 2016 Jkt 238001 agent such as a licensed customs broker. For IE and T&E in-bond shipments, and goods to be delivered to an FTZ, the ISF Importer may also be the party filing the IE, T&E, or FTZ documentation. For FROB cargo, the ISF Importer will be the carrier or the non-vessel operating common carrier. * * * * * Dated: June 28, 2016. Jeh Charles Johnson, Secretary. [FR Doc. 2016–15687 Filed 7–5–16; 8:45 am] BILLING CODE 9111–14–P POSTAL SERVICE 39 CFR Part 111 Address Quality Census Measurement and Assessment Process Postal ServiceTM. Supplemental notice of proposed rulemaking. AGENCY: ACTION: The Postal Service is revising its pending proposal to amend Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM®), to include a newly proposed measurement and assessment procedure for evaluating address quality for mailers who enter eligible letter- and flat-size pieces of First-Class Mail® (FCM) and Standard Mail® that meet the requirements for Basic or Full-Service mailings. SUMMARY: Submit comments on or before August 5, 2016. ADDRESSES: Mail or deliver written comments to the manager, Product Classification, U.S. Postal Service, 475 L’Enfant Plaza SW., Room 4446, Washington, DC 20260–5015. If sending comments by email, include the name and address of the commenter and send to Product;Classification@usps.gov, with a subject line of ‘‘Address Quality Census Measurement and Assessment Process.’’ Faxed comments are not accepted. You may inspect and photocopy all written comments, by appointment only, at USPS® Headquarters Library, 475 L’Enfant Plaza SW., 11th Floor North, Washington, DC 20260. These records are available for review on Monday through Friday, 9 a.m.–4 p.m., by calling 202–268–2906. FOR FURTHER INFORMATION CONTACT: Heather Dyer, USPS Mail Entry, Phone: (207) 482–7217, email: heather.l.dyer@ usps.gov. DATES: On December 23, 2014, the Postal Service SUPPLEMENTARY INFORMATION: PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 43965 published a notice of proposed rulemaking (79 FR 76930–76931) to add a process for measuring address quality. From that proposed rule, the mailing industry provided many insightful and valuable comments (outlined later in this document) to the Postal Service and requested that a revised proposed rule be published. Therefore, we are renaming and revising our original proposal, and publishing it with a request for additional comments. This proposed rulemaking is subject to both Postal Service management and Postal Regulatory Commission (PRC) approvals. The Postal Service continues to look for opportunities to work with mailers to improve address quality and reduce undeliverable-as-addressed (UAA) mail. We have developed a newly proposed procedure, the Address Quality Census Measurement and Assessment Process, to measure address quality pertaining to move-related changes. This proposed process will allow the Postal Service to provide valuable feedback to mailers who enter eligible letter- and flat-size pieces of FCM and Standard Mail that meet the requirements for Basic or FullService mailings. The Address Quality Census Measurement and Assessment Process will utilize a scorecard for mailers that conveys information on address hygiene as well as Move Update quality. The scorecard provides mailers with changeof-address (COA) data as well as details about mailpieces that are UAA. Presently, one of the benefits of the Full-Service Intelligent Mail® program is free Address Change Service (ACSTM) for mailpieces prepared in accordance with Full-Service requirements. In order to further encourage the adoption of Full-Service and to increase the number of mailers that receive address quality information, the Postal Service is proposing to extend free ACS to mailers who enter qualifying Basic automation and non-automation mailpieces that meet the criteria of the Address Quality Census Measurement and Assessment Process and to mailers that meet a FullService threshold of 95 percent along with other requirements, which are outlined later in this document. Today, some mailers who enter Periodicals could potentially be charged for manual address correction notices on mailpieces using a Full-Service ACS Service Type IDentifier (STID). The Postal Service is proposing that mailers who enter Full-Service Periodicals mailings using a Full-Service ACS STID will not be required to receive or pay for manual address correction notices unless they are requested. Although mailers who enter Periodicals will be E:\FR\FM\06JYP1.SGM 06JYP1

Agencies

[Federal Register Volume 81, Number 129 (Wednesday, July 6, 2016)]
[Proposed Rules]
[Pages 43961-43965]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-15687]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection

19 CFR Part 149

[USCBP-2016-0040]
RIN 1651-AA98


Definition of Importer Security Filing Importer

AGENCY: U.S. Customs and Border Protection, DHS.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Importer Security Filing and Additional Carrier 
Requirements regulations were implemented in 2009 as an interim final 
rule to improve CBP's ability to identify high-risk shipments in order 
to prevent smuggling and improve cargo safety and security. These 
regulations require certain cargo information to be submitted to CBP 
via an Importer Security Filing (ISF) before the cargo is loaded on a 
vessel that is destined to the United States. These regulations fulfill 
the requirements of section 203 of the SAFE Port Act of 2006 and 
section 343 of the Trade Act of 2002, as amended by the Maritime 
Transportation Security Act of 2002. The ISF Importer is the party that 
is required to file the ISF. This notice of proposed rulemaking (NPRM) 
proposes to expand the definition of ISF Importer for certain types of 
shipments to ensure that the party that has the best access to the 
required information will be the party that is responsible for filing 
the ISF.

DATES: Comments must be received on or before September 6, 2016.

FOR FURTHER INFORMATION CONTACT: Peyman Jamshidi, Program Manager, 
Vessel Manifest and Importer Security Filing, Office of Cargo and 
Conveyance Security, Office of Field Operations by email at: 
PEYMAN.JAMSHIDI@cbp.dhs.gov.

ADDRESSES: You may submit comments, identified by docket number, by one 
of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments via docket number 
USCBP-2016-0040.
     Mail: Border Security Regulations Branch, Regulations and 
Rulings, Office of International Trade, U.S. Customs and Border 
Protection, 90 K Street NE., 10th Floor, Washington, DC 20229-1177.
    Instructions: All submissions received must include the agency name 
and docket number for this rulemaking. All comments received will be 
posted without change to http://www.regulations.gov, including any 
personal information provided. For detailed instructions on submitting 
comments and additional information on the rulemaking process, see the 
``Public Participation'' heading of the SUPPLEMENTARY INFORMATION 
section of this document.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov. Submitted comments 
may also be inspected during regular business days between the hours of 
9:00 a.m. and 4:30 p.m. at the Office of International Trade, 
Regulations and Rulings, U.S. Customs and Border Protection, 90 K 
Street NE., 10th Floor, Washington, DC 20229-1177. Arrangements to 
inspect submitted comments should be made in advance by calling Mr. 
Joseph Clark at (202) 325-0118.

SUPPLEMENTARY INFORMATION:

Background

    After the terrorist attacks on September 11, 2001, CBP amended its 
regulations to require vessel carriers to electronically submit certain 
advance cargo information, including cargo declarations, to CBP no 
later than 24 hours before the cargo is laden aboard a vessel at a 
foreign port. See 19 CFR 4.7 and 4.7a. The rule was published in the 
Federal Register (67 FR 66318) on October 31, 2002. Its purpose was to 
enable CBP to identify high-risk cargo before the vessel arrived in the 
United States.
    Section 203 of the Security and Accountability for Every Port Act 
of 2006 (Pub. L. 109-347, 120 Stat. 1884 (SAFE Port Act)) directed the 
Secretary of Homeland Security, acting through the Commissioner of CBP, 
to promulgate regulations to ``require the electronic transmission to 
the Department [of Homeland Security] of additional data elements for 
improved high-risk targeting, including appropriate security elements 
of entry data, as determined by the Secretary, to be provided as 
advanced information with respect to cargo destined for importation 
into the United States prior to loading of such cargo on vessels at 
foreign seaports.'' Pursuant to this Act, and section 343(a) of the 
Trade Act of 2002 (19 U.S.C. 2071 note), CBP published an NPRM in the 
Federal Register on January 2, 2008 (73 FR 90), proposing to require 
importers and carriers to submit additional information pertaining to 
maritime cargo before the cargo is loaded on a vessel that is destined 
to the United States. The trade gave the proposed rule the shorthand 
name ``10 + 2'', which references the number of advance data elements 
CBP was proposing to collect. Importers, described in the proposed rule 
as Importer Security Filing Importers, would generally be required to 
submit 10 additional data elements (the 10 of ``10 + 2''). Carriers 
would generally be required to submit two additional data elements (the 
2 of ``10 + 2'').
    On November 25, 2008, CBP published an interim final rule and 
solicitation of comments in the Federal Register (73 FR 71730, CBP 
Decision 08-46). The interim final rule was effective on January 26, 
2009. However, a delayed compliance period of at least 12 months was 
provided to allow industry sufficient time to comply with the new 
requirements.
    The interim final rule finalized most of the provisions of the 
NPRM, including all the provisions relating to the carrier 
requirements. The only portions of the NPRM that were not finalized 
were the six importer data elements for which CBP provided some 
flexibility regarding the time and/or manner of compliance. CBP 
solicited public comments on the flexibilities provided. CBP also 
invited comments on the revised Regulatory Assessment and Final 
Regulatory Flexibility Analysis. CBP has not yet published a final rule 
addressing the flexibilities and the Regulatory Assessment and Final 
Regulatory Flexibility Analysis.

[[Page 43962]]

I. Summary of ISF Importer Requirements

    The interim final rule added a new part 149 to the CBP regulations, 
entitled Importer Security Filing. The Importer Security Filing 
regulations require ISF Importers, as defined in 19 CFR 149.1, to 
transmit an ISF to CBP, for cargo other than foreign cargo remaining on 
board (FROB), no later than 24 hours before cargo is laden aboard a 
vessel destined to the United States. The transmission of the ISF 
filing for FROB is required any time prior to lading.
    ISF Importers, or their agents, must submit 10 data elements to CBP 
for shipments consisting of goods intended to be entered into the 
United States and goods intended to be delivered to a foreign trade 
zone (FTZ). See 19 CFR 149.3(a). ISF Importers, or their agents, must 
submit five data elements to CBP for shipments consisting entirely of 
FROB and shipments consisting entirely of goods intended to be 
transported as Immediate Exportation (IE) or Transportation and 
Exportation (T&E) in-bond shipments. See 19 CFR 149.3(b).

II. Proposed Amendment

    This rulemaking proposes to expand the definition of the Importer 
Security Filing (ISF) Importer. Currently, an ISF Importer is generally 
defined in 19 CFR 149.1 as the party causing goods to arrive within the 
limits of a port in the United States by vessel.
    The regulation provides that generally the ISF Importer is the 
goods' owner, purchaser, consignee, or agent such as a licensed customs 
broker. However, the regulation limits the definition of ISF Importer 
to certain named parties for foreign cargo remaining on board (FROB), 
immediate exportation (IE), and transportation and exportation (T&E) 
in-bond shipments, and for merchandise being entered into a foreign 
trade zone (FTZ). For FROB cargo, the regulation provides that the ISF 
Importer is the carrier; for IE and T&E in-bond shipments, and goods to 
be delivered to an FTZ, the regulation provides that the ISF Importer 
is the party filing the IE, T&E, or FTZ documentation.
    Based on input from the trade as well as CBP's analysis, CBP has 
concluded that these limitations do not reflect commercial reality and, 
in some cases, designate a party as the ISF Importer even though that 
party has no commercial interest in the shipment and limited access to 
the ISF data. Therefore, as explained below, CBP is proposing to expand 
the definition of ISF Importer for FROB cargo, for IE and T&E shipments 
and for goods to be delivered to a FTZ.

1. Foreign Cargo Remaining on Board (FROB)

    Under the current definition, the ISF Importer for FROB shipments 
is the carrier. The interim final rule clarified that the carrier means 
the international carrier arriving in the United States, i.e., vessel 
operating carrier. See 73 FR 71743. The rationale for requiring the 
vessel operating carrier to provide the ISF for FROB shipments was that 
ultimately it is the vessel operating carrier that decides to transport 
the cargo to the United States.
    There is still much debate within the shipping community about who 
should be the ISF importer for FROB shipments. This debate stems from 
the relationship between vessel operating carriers and non-vessel 
operating common carriers (NVOCCs).\1\ When a party wants to ship goods 
on a vessel, the party can either book the shipment directly with the 
vessel operating carrier or it can use an NVOCC who acts as an 
intermediary between the party shipping the goods and the vessel 
operating carrier.
---------------------------------------------------------------------------

    \1\ A non-vessel operating common carrier (NVOCC) means a common 
carrier that does not operate the vessels by which the ocean 
transportation is provided, and is a shipper in its relationship 
with an ocean common carrier. See 19 CFR 4.7(b)(3)(ii).
---------------------------------------------------------------------------

    When a party books a FROB shipment directly with a vessel operating 
carrier, the vessel operating carrier has direct access to the required 
ISF data and is able to file the ISF information with CBP. However, 
when a party uses an NVOCC, the vessel operating carrier frequently 
does not have access to the required ISF data elements. This is because 
the NVOCC may not want to share confidential business information with 
the vessel operating carrier, a potential competitor.
    However, under the current definition of ISF Importer, the vessel 
operating carrier is always the ISF Importer for FROB shipments, even 
though it may not have access to the required information. In response 
to comments to the interim final rule, CBP addressed the issue of the 
NVOCC not sharing necessary ISF information with the vessel operating 
carrier by clarifying that the NVOCC can submit the ISF directly to 
CBP, if it does so as the vessel operating carrier's agent. See 73 FR 
71744. Based on CBP's experience with the ISF program, CBP has 
concluded that the procedure of having the NVOCC act as the agent of 
the vessel operating carrier for FROB shipments is not effective. The 
current requirement has not facilitated the sharing of necessary ISF 
information between NVOCCs and vessel operating carriers and has not 
resulted in the filing of accurate information. Rather, this procedure 
has resulted in unclear lines of responsibility and has hampered CBP's 
enforcement of the ISF requirements.
    In an effort to increase compliance and to ensure that the party 
that has direct access to ISF information is the party responsible for 
submitting the ISF to CBP, CBP is proposing to broaden the definition 
of an ISF Importer for FROB shipments to include NVOCCs. This change is 
consistent with the requirement of the SAFE Port Act, which provides 
that a requirement to provide information will be imposed on the party 
most likely to have direct knowledge of that information.\2\
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    \2\ The SAFE Port Act requires CBP to follow the parameters 
listed in the Trade Act of 2002, which provides that ``the 
requirement to provide particular information shall be imposed on 
the party most likely to have direct knowledge of that information. 
Where requiring information from the party with direct knowledge of 
that information is not practicable, the regulations shall take into 
account how, under ordinary commercial practices, information is 
acquired by the party on which the requirement is imposed, and 
whether and how such party is able to verify the information. Where 
information is not reasonably verifiable by the party on which a 
requirement is imposed, the regulations shall permit that party to 
transmit information on the basis of what it reasonably believes to 
be true.''
---------------------------------------------------------------------------

    Broadening the definition of ISF Importer to include NVOCCs is also 
consistent with the general definition that the ISF Importer means the 
party causing the goods to arrive within the limits of a port in the 
United States by vessel. The NVOCC acts as the party booking the 
shipment aboard the carrier and typically has advance knowledge of the 
voyage's itinerary, i.e., whether the vessel will enter a U.S. port. By 
booking the shipment, the NVOCC is the party causing the goods to 
arrive in the United States. In these instances, not only will the 
NVOCC be the party most able to obtain the required ISF information, 
but it will be the party that causes the goods to arrive within the 
limits of a port in the United States as FROB cargo.
    In some circumstances, the vessel operating carrier would be the 
party that causes the goods to arrive in the United States despite the 
NVOCC having booked the shipment. An example would be when an NVOCC 
books a shipment not initially scheduled to arrive in the United 
States, but the vessel is diverted to the United States by the vessel 
operating carrier. If the cargo remains on board the vessel at the U.S. 
port and is not discharged until it arrives at the originally scheduled 
foreign destination port, this would

[[Page 43963]]

create FROB cargo. In this situation, the vessel operating carrier 
would be the party that caused the cargo to arrive in the United States 
and thus the party responsible for filing the ISF.

2. IE, T&E, and FTZ Cargo

    As provided in 19 CFR 149.1(a), the ISF Importer for IE and T&E in-
bond shipments and for shipments of goods to be delivered to an FTZ is 
the party that files the IE, T&E, or FTZ documentation with CBP. CBP 
believes that this definition needs to be broadened because often the 
party responsible for filing the ISF did not cause the goods to arrive 
within the limits of a port in the United States, but is a commercially 
disinterested party at the time of filing and/or may not have access to 
the required ISF data.
    IE and T&E entries are frequently not filed until after the cargo 
has arrived within limits of a port in the United States. Therefore, 
there is not yet a party that files the IE or T&E documentation 24 
hours prior to lading. In some cases, the party that will be 
responsible for filing the ISF has not yet been identified. In 
addition, in some cases, the party that will file the IE or T&E 
documentation has no commercial interest in the underlying merchandise 
and that party is a commercially disinterested party 24 hours prior to 
lading. In these cases, the party filing the IE or T&E entries with CBP 
did not cause the goods to arrive within the limits of a port in the 
United States and is not the party most likely to have direct knowledge 
of the required information. To address this problem, the goods' owner, 
purchaser, consignee, or agent such as a licensed customs broker will 
commonly file the ISF-10 required for shipments intended to be entered 
into the United States, which consists of 10 data elements, as opposed 
to the ISF-5 required for IE and T&E shipments, which consists of five 
data elements.
    Similarly, for goods being entered into an FTZ, the party filing 
the FTZ documentation is frequently a commercially disinterested party 
and/or is not the party most able to obtain the required information. 
For example, it is common for the FTZ operator to file the FTZ 
documentation with CBP. However, the FTZ operator is commonly not the 
party causing the goods to enter the limits of the port in the United 
States and is a commercially disinterested party 24 hours prior to 
lading. As a result, the party responsible for filing the ISF is not 
the party most likely to have direct knowledge of the required 
information.
    To address these issues, CBP is proposing to expand the definition 
of ISF Importer for IE and T&E in-bond shipments, and for goods to be 
delivered to an FTZ, to also include the goods' owner, purchaser, 
consignee, or agent such as a licensed customs broker. These are the 
same parties that are currently included within the definition of ISF 
Importer for all shipments other than FROB, IE and T&E in-bond 
shipments, and goods to be delivered to a FTZ. By broadening the 
definition to include these parties, the responsibility to file the ISF 
for IE, T&E, and FTZ shipments will be with the party causing the goods 
to enter the limits of a port in the United States and most likely to 
have access to the required ISF information and not with a commercially 
disinterested party.

III. Regulatory Analysis

A. Executive Orders 12866 and 13563

    Executive Orders 13563 and 12866 direct agencies to assess the 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. This proposed rule is a ``significant regulatory action,'' 
although not an economically significant regulatory action, under 
section 3(f) of Executive Order 12866. Accordingly, the Office of 
Management and Budget has reviewed this proposed regulation.
    Under current regulations, the party required to submit ISF is the 
party causing the goods to enter the limits of a port in the United 
States. However, the regulation limits the definition for FROB, IE, and 
T&E shipments as well as for merchandise being entered into a FTZ to 
certain named parties. Based on input from the trade as well as CBP's 
analysis, CBP has concluded that these limitations do not reflect 
commercial reality and, in some cases, designate a party as the ISF 
Importer even though that party has no commercial interest in the 
shipment and limited access to the ISF data. In some cases, the party 
responsible may not even be involved in the importation at the time the 
ISF must be filed. This causes confusion in the trade as to who is 
responsible for filing the ISF and raises confidentiality concerns as 
sometimes the private party with the information gives the information 
to the ISF importer who then sends it to CBP. Therefore, CBP is 
proposing to expand the definition of ISF Importer for FROB cargo, for 
IE and T&E shipments and for goods to be delivered to a FTZ. This 
change is consistent with the requirement of the SAFE Port Act, which 
provides that the requirement to file the ISF will be imposed on the 
party most likely to have direct knowledge of that information.
    This proposed rule would modify the definition of the ISF Importer 
for FROB cargo, for IE and T&E shipments, and for goods to be delivered 
to a FTZ. The current definition causes confusion and confidentiality 
concerns. The current ISF Importer for FROB shipments is the vessel 
operating carrier. In cases where the shipper uses an intermediary, 
i.e., NVOCC, the vessel operating carrier does not have access to 
certain of the required elements for confidentiality reasons--only the 
intermediary has this information. In most cases, the NVOCC chooses to 
file this information directly to CBP, sidestepping the confidentiality 
concerns, but the legal burden is on the vessel operating carrier so 
some NVOCCs feel pressured to share this information with the carrier. 
This regulation would define the ISF Importer for FROB cargo as the 
vessel operating carrier or the NVOCC. Under this regulation, the 
NVOCC, rather than the vessel operating carrier, would be the ISF 
Importer if it is the party in possession of the required information.
    Likewise, the definition of ISF Importer causes confusion for IE 
and T&E cargo. The ISF Importer in these cases is the filer of the IE 
or T&E documentation. This causes confusion because the IE or T&E 
documentation often is not created until the cargo arrives in the 
United States. By contrast, ISF information must be submitted at least 
24 hours prior to lading. The proposed rule would expand the definition 
of ISF Importer for IE and T&E in-bond shipments to also include the 
goods' owner, purchaser, consignee, or agent such as a licensed customs 
broker. The proposed rule would also make a similar change to the 
definition of the ISF Importer of FTZ cargo. With this change, the ISF 
Importer will be a party with a bona fide interest in the commercial 
shipment and access to the required data.
    The modification of the definition of ISF Importer will simply 
shift the legal responsibility in some cases for filing the ISF from 
one party to another for a subset of the total cargo (FROB; IE and T&E; 
and FTZ cargo). For IE, T&E, and FTZ cargo, the party who is currently 
required to file the data may not yet

[[Page 43964]]

even be involved in the transaction at the time the data must be 
submitted. In these cases another party that has the data such as the 
owner, purchaser, consignee, or agent often files the data, though they 
are not legally obligated to file it. Under this proposed rule, these 
parties who have the data will be included in the definition of the 
party responsible for filing the data. Since these parties are 
generally the ones currently submitting this data to CBP, this change 
will have no significant impact. In some rare instances, this proposed 
rule may shift the burden of filing from one party to another. For 
example, since the party currently responsible for filing may not be 
involved in the transaction at the time the data must be submitted, it 
could be one of several parties (e.g., the owner, purchaser, consignee, 
or agent) that actually submits the information. Once this proposed 
rule is in effect, there will be clarity as to which party is 
responsible, which could change who actually submits the data. In the 
vast majority of cases, there will be no change in who submits the 
data, but it is possible that there will be a change. To the extent 
that there is a change in who actually submits the ISF data, there will 
be a shift in the time burden to do so from one party to the other. CBP 
estimates that submitting this information takes 2.19 hours at a cost 
of $50.14 per hour.\3\ This loaded wage rate was estimated by 
multiplying the Bureau of Labor Statistics' (BLS) 2014 median hourly 
wage rate for Ship and Boat Captains and Operators ($32.73) by the 
ratio of BLS' average 2014 total compensation to wages and salaries for 
Transportation and Material Moving occupations (1.5319), the assumed 
occupational group for ship and boat captains and operators, to account 
for non-salary employee benefits.4 5
---------------------------------------------------------------------------

    \3\ This differs from the estimated wage rate on the most recent 
supporting statement for this information collection: OMB Control 
Number 1651-0001, available at: http://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=201506-1651-003, which is based on outdated 
data. We will update the wage rate in this supporting statement the 
next time the ICR is renewed.
    \4\ Source of median wage rate: U.S. Bureau of Labor Statistics. 
Occupational Employment Statistics, ``May 2014 National Occupational 
Employment and Wage Estimates, United States--Median Hourly Wage by 
Occupation Code: 53-5020.'' Updated March 25, 2015. Available at 
http://www.bls.gov/oes/2014/may/oes_nat.htm#53-0000. Accessed June 
15, 2015.
    \5\ The total compensation to wages and salaries ratio is equal 
to the calculated average of the 2014 quarterly estimates (shown 
under Mar., June, Sep., Dec.) of the total compensation cost per 
hour worked for Transportation and Material Moving occupations 
(26.62) divided by the calculated average of the 2014 quarterly 
estimates (shown under Mar., June, Sep., Dec.) of wages and salaries 
cost per hour worked for the same occupation category (17.3775). 
Source of total compensation to wages and salaries ratio data: U.S. 
Bureau of Labor Statistics. Employer Costs for Employee 
Compensation. Employer Costs for Employee Compensation Historical 
Listing March 2004--December 2015, ``Table 3. Civilian workers, by 
occupational group: Employer costs per hours worked for employee 
compensation and costs as a percentage of total compensation, 2004-
2015 by Respondent Type: Transportation and material moving 
occupations.'' June 10, 2015. Available at http://www.bls.gov/ncs/ect/sp/ececqrtn.pdf. Accessed June 15, 2015.
---------------------------------------------------------------------------

    Therefore, to the extent this proposed rule shifts the reporting 
burden from one party to the other, there will be a corresponding shift 
of $109.81 in opportunity cost per filing. CBP lacks data showing how 
often there would be a shift in the actual reporting burden as a result 
of this rule but it believes it to be very small and possibly zero. CBP 
requests comment on this matter.
    For FROB, the ISF Importer must currently either obtain the 
information from a third party that has the necessary information or 
ask that the third party file the information directly to CBP. In some 
cases, the third party shares this information with the ISF Importer, 
but it usually files the data directly with CBP for confidentiality 
reasons. Under the proposed regulation, the party that has access to 
the ISF information would submit it directly to CBP. Since this third 
party is generally already providing the ISF information through the 
current ISF Importer or directly to CBP, this rule will not add a 
significant burden to these entities. As described above, to the extent 
that this rule shifts the reporting burden from one party to the other, 
there will be a corresponding shift of $109.81 in opportunity cost per 
filing. CBP lacks data showing how often there would be a shift in the 
actual reporting burden as a result of this rule but it believes it to 
be very small and possibly zero. CBP requests comment on this matter.
    This proposed rule benefits all parties by eliminating the 
confusion surrounding the responsibility for the submission of ISF 
information. In addition, this rule would significantly reduce 
confidentiality concerns that may be caused by the current 
requirements. This rule would ensure the party with the best access to 
the information is the party who files the information, which will 
improve the accuracy of the information CBP uses for targeting. 
Finally, eliminating a step in the transmission process (sending the 
ISF information from the third party to the current ISF importer) will 
result in CBP getting the information sooner. Any extra time can be 
used for more extensive targeting.

B. Regulatory Flexibility Act

    This section examines the impact of the rulemaking on small 
entities as required by the Regulatory Flexibility Act (5 U.S.C. 603), 
as amended by the Small Business Regulatory Enforcement and Fairness 
Act of 1996. A small entity may be a small business (defined as any 
independently owned and operated business not dominant in its field 
that qualifies as a small business per the Small Business Act); a small 
not-for-profit organization; or a small governmental jurisdiction 
(locality with fewer than 50,000 people).
    In the Interim Final Rule establishing the ISF requirements (73 FR 
71730; November 25, 2008, CBP Decision 08-46; Docket Number USCBP-2007-
0077), CBP concluded that many importers of containerized cargo are 
small entities. The rule could affect any importer of containerized 
cargo so it could have an impact on a substantial number of small 
entities.
    This impact, however, is very small. The modification of the 
definition of ISF Importer will simply shift the legal responsibility 
in some cases for filing the ISF from one party to another for a subset 
of the total cargo (FROB; IE and T&E; and FTZ cargo). For IE, T&E, and 
FTZ cargo, the party who is currently required to file the data may not 
yet even be involved in the transaction at the time the data must be 
submitted. In these cases another party such as the owner, purchaser, 
consignee, or agent often files the data, though they are not legally 
obligated to file it. Under this proposed rule, these parties will be 
included in the definition of the party responsible for filing the 
data. Since these parties are currently submitting this data to CBP, 
this change will have no significant impact. For FROB, the ISF Importer 
must currently either obtain the information from a third party that 
has the necessary information or ask that the third party file the 
information directly to CBP. In some cases, the third party shares this 
information with the ISF Importer, but it usually files the data 
directly with CBP for confidentiality reasons. Under the proposed 
regulation, CBP is expanding the definition of ISF Importer so that the 
party that has access to the ISF information would submit it directly 
to CBP as the ISF Importer. Since this third party is already providing 
the ISF information through the current ISF Importer or directly to 
CBP, this proposed rule will not add a significant burden to these 
entities.
    For these reasons, CBP certifies that this rule will not have a 
significant

[[Page 43965]]

economic impact on a substantial number of small entities.

C. Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandate Reform Act of 1995 (UMRA) requires 
agencies to assess the effects of their regulatory actions on State, 
local, and tribal governments and the private sector. This proposed 
rule is exempt from these requirements under 2 U.S.C. 1503 (Exclusions) 
which states that UMRA ``shall not apply to any provision in a bill, 
joint resolution, amendment, motion, or conference report before 
Congress and any provision in a proposed or final Federal regulation 
that is necessary for the national security or the ratification or 
implementation of international treaty obligations.''

D. Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3507), an agency may not conduct, and a person is not required to 
respond to, a collection of information unless the collection of 
information displays a valid control number assigned by OMB. The 
collections of information related to this NPRM are approved by OMB 
under collection 1651-0001.

List of Subjects in 19 CFR Part 149

    Arrival, Declarations, Customs duties and inspection, Freight, 
Importers, Imports, Merchandise, Reporting and recordkeeping 
requirements, Shipping, Vessels.

Proposed Amendment to the Regulations

    For the reasons stated in the preamble, DHS proposes to amend part 
149 of title 19 of the Code of Federal Regulations (19 CFR part 149), 
as set forth below:

PART 149--IMPORTER SECURITY FILING

0
1. The authority citation for part 149 continues to read as follows:

    Authority:  5 U.S.C. 301; 6 U.S.C. 943; 19 U.S.C. 66, 1624, 2071 
note.

0
2. Section 149.1(a) is revised to read as follows:


Sec.  149.1  Definitions.

    (a) Importer Security Filing Importer. For purposes of this part, 
Importer Security Filing Importer (ISF Importer) means the party 
causing goods to arrive within the limits of a port in the United 
States by vessel. For shipments other than foreign cargo remaining on 
board (FROB), the ISF Importer will be the goods' owner, purchaser, 
consignee, or agent such as a licensed customs broker. For IE and T&E 
in-bond shipments, and goods to be delivered to an FTZ, the ISF 
Importer may also be the party filing the IE, T&E, or FTZ 
documentation. For FROB cargo, the ISF Importer will be the carrier or 
the non-vessel operating common carrier.
* * * * *

    Dated: June 28, 2016.
Jeh Charles Johnson,
Secretary.
[FR Doc. 2016-15687 Filed 7-5-16; 8:45 am]
 BILLING CODE 9111-14-P