Continuing Education for Licensed Customs Brokers, 41224-41260 [2023-12921]

Agencies

• DEPARTMENT OF HOMELAND SECURITY
• U.S. Customs and Border Protection

[Federal Register Volume 88, Number 120 (Friday, June 23, 2023)]
[Rules and Regulations]
[Pages 41224-41260]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-12921]



[[Page 41223]]

Vol. 88

Friday,

No. 120

June 23, 2023

Part III





Department of Homeland Security





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U.S. Customs and Border Protection





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19 CFR Part 111





Continuing Education for Licensed Customs Brokers; Final Rule

Federal Register / Vol. 88, No. 120 / Friday, June 23, 2023 / Rules 
and Regulations

[[Page 41224]]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection

19 CFR Part 111

[USCBP-2021-0030; CBP Dec. 23-04]
RIN 1651-AB03


Continuing Education for Licensed Customs Brokers

AGENCY: U.S. Customs and Border Protection, Department of Homeland 
Security.

ACTION: Final rule.

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SUMMARY: This document adopts as final, with changes, proposed 
amendments to the U.S. Customs and Border Protection (CBP) regulations 
requiring continuing education for individual customs broker license 
holders (individual brokers) and the framework for administering this 
requirement. By requiring individual brokers to remain knowledgeable 
about recent developments in customs and related laws as well as 
international trade and supply chains, CBP's framework will enhance 
professionalism and competency within the customs broker community. CBP 
has determined that this framework will contribute to increased trade 
compliance and better protection of the revenue of the United States.

DATES: This final rule is effective as of July 24, 2023.

FOR FURTHER INFORMATION CONTACT: Elena D. Ryan, Special Advisor, 
Programs and Policy Analysis, Regulations and Rulings, Office of Trade, 
U.S. Customs and Border Protection, at (202) 325-0001 or 
[email protected]; and, Sharolyn J. McCann, Director, 
Commercial Operations, Revenue and Entry, Office of Trade, U.S. Customs 
and Border Protection, at (202) 384-8935, 
[email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Background and Summary
    A. Authority for the Continuing Broker Education Requirement
    B. Prior Related Publications
    C. Overview of Licensing Requirements for Individual Brokers
    D. Initial Certification Date
    E. CBP Implementation of the Continuing Broker Education 
Requirement
II. Summary of Changes From the Proposed Regulations
III. Discussion of Comments
    A. The Continuing Broker Education Requirement
    B. Certification Dates
    C. Individuals to Whom the Requirement Applies
    D. Completing the 36 Continuing Education Credits
    E. Recordkeeping
    F. CBP-Selected Accreditors
    G. Qualified Continuing Broker Education
    H. The Accreditation Process
    I. Enforcement
IV. Conclusion
V. Statutory and Regulatory Requirements
    A. Executive Orders 12866 and 13563
    B. Regulatory Flexibility Act
    C. Paperwork Reduction Act
VI. Signing Authority
VII. List of Subjects

I. Background and Summary

A. Authority for the Continuing Broker Education Requirement

    Section 641 of the Tariff Act of 1930, as amended (19 U.S.C. 1641), 
provides that individuals and business entities must hold a valid 
customs broker's license and permit to transact customs business on 
behalf of others. The statute also sets forth standards for the 
issuance of broker licenses and permits, provides for disciplinary 
action against customs brokers in the form of suspension or revocation 
of such licenses and permits or assessment of monetary penalties and 
provides for the assessment of monetary penalties against persons for 
conducting customs business without the required broker's license.
    Section 641 authorizes the Secretary of the U.S. Department of the 
Treasury (Treasury) to prescribe rules and regulations relating to the 
customs business of brokers as may be necessary to protect importers 
and the revenue of the United States and to carry out the other 
provisions of section 641. See 19 U.S.C. 1641(f). That authority was 
delegated to the Secretary of the U.S. Department of Homeland Security 
(DHS) as a result of the enactment of the Homeland Security Act of 2002 
(Pub. L. 107-296, 116 Stat. 2142).\1\ Accordingly, the Secretary of DHS 
is authorized to prescribe rules and regulations relating to the 
customs business of brokers as may be necessary to protect importers 
and the revenue of the United States and to carry out the other 
provisions of section 641. See 19 U.S.C. 1641(f).
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    \1\ The Homeland Security Act of 2002 generally transferred the 
functions of the former U.S. Customs Service from the Secretary of 
the Treasury to the Secretary of DHS and provided that the Secretary 
of the Treasury retain authority over customs revenue functions, 
unless specifically delegated to the Secretary of DHS. See 6 U.S.C. 
212(a)(1). Paragraph 1(a)(i) of Treasury Department Order No. 100-16 
contains a list of subject matters over which the Secretary of the 
Treasury retained authority. See Appendix to part 0 of title 19, 
Code of Federal Regulations (Appendix to 19 CFR part 0). The other 
functions of the former U.S. Customs Service not expressly listed in 
paragraph 1(a)(i) of Treasury Department Order No. 100-16 were 
transferred from the Secretary of the Treasury to the Secretary of 
DHS. As paragraph 1(a)(i) of Treasury Department Order No. 100-16 
does not list the regulation of customs brokers, the Secretary of 
the Treasury did not retain authority over this subject matter.
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    Furthermore, 19 U.S.C. 1641(b)(4) imposes upon customs brokers the 
duty to exercise responsible supervision and control over the customs 
business that it conducts. The statute also permits the Secretary of 
DHS to test persons for their knowledge of customs and related laws 
prior to issuing a license. See 19 U.S.C. 1641(b)(2). Based upon 19 
U.S.C. 1641, U.S. Customs and Border Protection (CBP) has promulgated 
regulations setting forth additional obligations of customs brokers 
pertinent to the conduct of their customs business. CBP believes that 
maintaining current knowledge of customs laws and procedures is 
essential for customs brokers to meet their legal duties. Requiring a 
customs broker to fulfill a continuing education requirement is the 
most effective means to ensure that the customs broker keeps up with an 
ever-changing customs practice after passing the broker exam and 
subsequently receiving the license.

B. Prior Related Publications

    On October 28, 2020, CBP published an advance notice of proposed 
rulemaking (ANPRM) in the Federal Register (85 FR 68260) soliciting 
comments on a potential framework of continuing education requirements 
for licensed customs brokers. CBP sought to gather information and data 
from the broader customs community, analyze the potential impact of 
such a framework on the customs brokers, and consider whether such a 
requirement would contribute to increased trade compliance. The ANPRM 
provided for a 60-day public comment period, which closed on December 
28, 2020. CBP received 29 comments in response to the ANPRM.
    These comments were addressed in a notice of proposed rulemaking 
(NPRM) that CBP published in the Federal Register (86 FR 50794) on 
September 10, 2021, announcing a proposed framework for individual 
customs broker license holders (individual brokers) to administratively 
maintain their license through completion of qualified continuing 
broker education.\2\

[[Page 41225]]

CBP proposed to require individual brokers to complete at least 36 
continuing education credits per triennial period with limited 
exceptions. The NPRM provided for a 60-day public comment period, which 
closed on November 9, 2021.\3\ CBP received 70 comments in response to 
the NPRM.
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    \2\ For clarity, in this document, CBP will refer to individuals 
who obtained a valid customs broker's license as an ``individual 
customs broker license holder,'' ``individual customs broker,'' or 
``individual broker.'' ``Customs brokers'' refers to the entire body 
of individuals, partnerships, associations, and corporations that 
have obtained a valid customs broker's license. See 19 CFR 111.1.
    \3\ The comments received in response to the NPRM can be viewed 
in their entirety on the public docket, Docket No. USCBP-2021-0030, 
which can be accessed through https://www.regulations.gov.
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    Below is a summary of the rationale provided for the rule. For a 
more detailed discussion, including background information for the 
development of this rule, please refer to the NPRM.

C. Overview of Licensing Requirements for Individual Brokers

    CBP is responsible for administering the licensing requirements for 
customs brokers and sets forth those requirements in part 111 of title 
19 of the Code of Federal Regulations (19 CFR part 111). A prospective 
customs broker must pass a broker exam administered by CBP which is 
designed to determine the individual's knowledge of customs and related 
laws, regulations and procedures, bookkeeping, accounting, and all 
other appropriate matters. Subsequently, the individual submits an 
application for a broker's license. If CBP finds that the applicant is 
qualified, following an investigation, and has paid all applicable 
fees, then CBP will issue a broker's license. In order to qualify for a 
license, an individual must be a United States citizen who is at least 
21 years of age and not an officer or employee of the United States 
Government, be in possession of good moral character, and pass a broker 
exam administered by CBP. See 19 CFR 111.11.
    Customs brokers administratively maintain a license through the 
filing of reports pursuant to 19 U.S.C. 1641(g) and 19 CFR 111.30(d) 
(the triennial status report), the payment of fees required in 19 CFR 
111.96, and notifications to CBP as set forth in 19 CFR 111.30, as well 
as fulfilling other legal obligations.\4\ See generally 19 CFR 111.21-
111.45. This document finalizes an additional administrative 
requirement, i.e., completion of the continuing broker education 
requirement, for individual brokers to maintain their licenses. As 
discussed in greater detail in the NPRM, recent developments have 
demonstrated the need for key parties involved in importing, exporting, 
claiming drawback, etc., to keep up to date on training and 
continuously build and maintain their knowledge of current 
requirements.\5\
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    \4\ Customs brokers have legal obligations, to CBP and to the 
broker's clientele, including, but not limited to, the exercising of 
due diligence in making financial settlements, answering 
correspondence, and preparing paperwork or filings related to 
customs business. See 19 CFR 111.29(a). Under 19 U.S.C. 1641(b)(4), 
a customs broker has the statutory duty to exercise responsible 
supervision and control over the customs business that he or she 
conducts. See also 19 CFR 111.1 and 111.28(a).
    \5\ Recent developments, include, but are not limited to, 
drawback modernization, 83 FR 64942 (Dec. 18, 2018), implementation 
of the Agreement between the United States of America, the United 
Mexican States, and Canada (the USMCA), United States-Mexico-Canada 
Agreement Implementation Act, Public Law 116-113, 134 Stat. 11 (19 
U.S.C. Chapter 29), the dramatic increase in low-value shipments (19 
U.S.C. 1321(a)(2)(C)), and CBP's updates to 19 CFR part 111, the 
regulations governing customs brokers and their obligations to 
clients and CBP. See 87 FR 63267 (Oct. 18, 2022) and 87 FR 63262 
(Oct. 18, 2022).
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D. Initial Certification Date

    As detailed in Section II and in the responses to relevant comments 
in Section III below, individual brokers will be required to certify 
compliance with the continuing broker education requirements (trainings 
and educational activity that have been accredited by a CBP-selected 
accreditor or identified by CBP per Sec.  111.103(a)) as part of the 
filing of their 2027 triennial status reports (approximately between 
December 15, 2026, and February 28, 2027). To allow for the full 
implementation of the continuing education requirement, CBP will reduce 
the number of required continuing education credits for the triennial 
period beginning on February 1, 2024. It is important to note that the 
proration will only affect the triennial period between 2024 and 2027 
and all triennial periods thereafter will require the completion and 
certification of completion of 36 continuing education credits. For the 
triennial period beginning on February 1, 2024, CBP will reduce the 36 
continuing education credits, required to be completed, by six credits 
for approximately every six months that elapse between February 1, 2024 
and the compliance date on which individual brokers may begin 
completing qualified continuing broker education courses, as announced 
in a Federal Register notice, following the publication of this final 
rule. Along with specifying the number of required continuing education 
credits the Federal Register notice will also announce the date on 
which qualified continuing broker education courses will be available 
to individual brokers to begin meeting the requirement. CBP will 
publish this Federal Register notice at least 30 days prior to the 
compliance date announced therein. No educational activities or 
trainings completed before the compliance date announced in the Federal 
Register notice will qualify towards the continuing education credits 
required to be completed by the filing of the 2027 triennial status 
report.

E. CBP Implementation of the Continuing Broker Education Requirement

    To ensure qualified trainings and educational activities are 
available to individual brokers, CBP will take certain necessary steps 
to implement the continuing broker education requirement. To collect 
information about standards and to identify qualified accreditors, CBP 
is utilizing the System for Award Management (SAM), which will involve 
a Request for Information (RFI) and Request for Proposals (RFPs).\6\ 
Subsequently, CBP will announce the CBP-selected accreditors on its 
website at CBP.gov, to ensure that all individual brokers are aware of 
the selected accreditors. Afterwards, CBP, in conjunction with the CBP-
selected accreditors, will establish standards and guidelines for 
qualified continuing broker education, including information on how and 
when CBP-selected accreditors will begin considering trainings and 
educational activities for accreditation. Finally, CBP will announce 
the initial qualified continuing broker education trainings and 
educational activities available to individual brokers and the means 
through which individual brokers may identify additional qualified 
trainings and educational activities.
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    \6\ Access to and additional information about the SAM may be 
viewed at www.sam.gov.
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II. Summary of Changes From the Proposed Regulations

    CBP received 70 comments in response to the NPRM. As more fully 
discussed in Section III below, CBP carefully considered all public 
comments to the NPRM and determined to finalize the continuing broker 
education framework with minor changes. While considering the public 
comments, CBP identified five changes that would reduce confusion and 
increase the intended flexibility of the continuing broker education 
requirement, and one nomenclature change intended to provide clarity 
and consistency. CBP is also changing one amendatory instruction to 
account for an amendment made by another final

[[Page 41226]]

rule document \7\ that amended the broker regulations in part 111 
between the issuance of the NPRM and this document, as described in 
more detail below.
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    \7\ On October 18, 2022, CBP published a final rule document in 
the Federal Register entitled ``Modernization of the Customs Broker 
Regulations'' (the Part 111 Rewrite). See 87 FR 63267.
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    In the NPRM, CBP did not specify when individual brokers would be 
expected to certify completion of the initial three-year cycle of the 
continuing broker education requirement. See 86 FR 50794 (Sept. 10, 
2021). In this rule, as discussed in more detail below in the relevant 
comments, CBP is specifying that the first time at which individual 
brokers will be required to certify completion of the continuing broker 
education requirement will be with the filing of their 2027 triennial 
status reports.
    In the NPRM, at Sec.  111.1, CBP proposed the smallest unit of 
continuing education credit as one credit per one hour of continuous 
participation in qualified continuing broker education. See 86 FR 50794 
(Sept. 10, 2021). In this rule, as discussed in more detail below in 
the relevant comments, CBP will allow for the recognition of ``half 
credits'' (30 minutes of continuous participation in qualifying 
continuing broker education) as the smallest unit of continuing 
education credit.
    In the NPRM, in Sec.  111.103(a)(1), CBP proposed that qualified 
continuing broker education must be offered by a government agency or 
be approved and assigned continuing education credit by a CBP-selected 
accreditor. See 86 FR 50794 (Sept. 10, 2021). In this rule, as 
discussed in more detail below in the relevant comments, when qualified 
continuing broker education is offered by a government agency, CBP will 
identify the specific qualified continuing broker education 
opportunities offered by CBP or another government agency, after 
consultation with the other government agency, that are relevant to 
customs business and may provide continuing education credit upon 
completion.
    In the NPRM, in Sec.  111.103(a)(2), CBP proposed four broad 
categories of recognized trainings or educational activities. See 86 FR 
50794 (Sept. 10, 2021). In this rule, as discussed in more detail below 
in the relevant comments, CBP will amend the description of the first 
category (allowing for seminars, webinars, or workshops) and add a 
fifth category to allow for self-guided trainings and educational 
activities which culminate in a retention test.
    In the NPRM, in Sec.  111.103(d), CBP outlined the responsibilities 
of CBP-selected accreditors towards the accreditation process. See 86 
FR 50794 (Sept. 10, 2021). In this rule, as discussed in more detail 
below in the relevant comments, CBP will explicitly prohibit CBP-
selected accreditors from denying accreditation to training or 
educational activity solely because it was previously denied by the 
CBP-selected accreditor or any other CBP-selected accreditor.
    Additionally, CBP has decided to use the phrase ``individual 
brokers'' in the regulations for clarity and consistency when referring 
to the specific subset of customs brokers affected by the continuing 
broker education requirement. For clarity, CBP differentiates between 
the entire body of entities with a valid customs broker license and 
individuals with a valid customs broker license. For consistency, the 
entire licensed body is referred to as ``customs brokers'' and licensed 
individuals are referred to as ``individual brokers.'' The continuing 
education requirement only applies to individual brokers and not to the 
entire body of customs brokers (which includes individuals, 
partnerships, associations, and corporations). This final rule document 
adds the phrase ``individual brokers'' in Sec. Sec.  111.0 and 111.1 
when referring to the continuing education requirement and adds 
``individual brokers'' elsewhere in the following other Sec. Sec.  of 
the newly added title of subpart F of part 111: 111.101, 111.102, 
111.103, and 111.104. For additional information, please see the 
relevant comments in Section III below.
    Finally, on October 18, 2022, CBP published a final rule document 
in the Federal Register entitled ``Modernization of the Customs Broker 
Regulations'' (the Part 111 Rewrite). See 87 FR 63267. That final rule 
substantially rewrote part 111 of title 19 of the CFR and made certain 
changes to 19 CFR 111.30. As such, in this document, CBP has made 
technical and conforming changes to 19 CFR 111.30(d) from what was 
proposed in the NPRM to incorporate the structural changes made in the 
Part 111 Rewrite. CBP is further making a minor change to the section 
heading of 19 CFR 111.30. CBP had included a sightly revised section 
heading in the Part 111 Rewrite final rule, as well as in the preceding 
NPRM \8\ but inadvertently failed to include an instruction for the 
Federal Register to make that change. In addition, CBP is correcting a 
grammatical error in Sec.  111.19(c) that was made in a concurrent 
final rule, published in the Federal Register on the same day, entitled 
``Elimination of Customs Broker District Permit Fee'' (87 FR 63262). 
The term ``permit user fee'' was inadvertently written as ``user permit 
fee.''
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    \8\ 85 FR 34836 (June 5, 2020).
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III. Discussion of Comments

    CBP has carefully considered all comments submitted in response to 
the NPRM. During the 60-day public comment period, CBP received 70 
comments. Of the 70 comments, 68 comments were responsive, one comment 
was a duplicate, and one comment was beyond the scope of the proposed 
rule. Of the 68 responsive comments, 57 comments explicitly supported 
the continuing broker education requirement, while seven comments 
explicitly disputed the need to have a continuing broker education 
requirement, with one of the seven comments disputing the application 
of the requirement to brokers only. Four commenters sought additional 
information. Generally, the 68 responsive comments addressed multiple 
topics that CBP has divided, grouped, and addressed below.

A. The Continuing Broker Education Requirement

    In the NPRM, CBP proposed an additional administrative requirement 
for individual brokers to maintain their licenses by completing 
qualified continuing broker education. CBP received many comments 
expressing support for the continuing broker education requirement and 
multiple comments disputing the need for a continuing broker education 
requirement.
    Comment: Many commenters stated that a continuing broker education 
requirement was necessary. Certain commenters highlighted that the 
requirement would ensure better outcomes for clients, professionalize 
the field, ensure individual brokers remained knowledgeable about the 
law, and help individual brokers avoid costs such as fines and time 
spent correcting filings. Commenters also highlighted that continuing 
education promotes compliance and engagement that assists CBP in 
protecting U.S. borders, increases trade compliance, and helps protect 
the revenue of the United States.
    Response: CBP appreciates the supportive comments regarding the 
need for the continuing broker education requirement. CBP concurs with 
the comments as summarized above and in CBP's opinion those comments 
support CBP's assessment of the need for a continuing education 
requirement.

[[Page 41227]]

    Comment: Multiple commenters stated that a continuing broker 
education requirement is unnecessary because the customs broker 
licensing exam was a sufficiently effective barrier to entry of 
unqualified individuals and clearly demonstrated the superior and 
sufficient knowledge base of individuals passing the exam. Commenters 
also highlighted that open access to the statutes and regulations and 
CBP's public communications are sufficient to keep individual brokers 
informed and knowledgeable.
    Response: CBP disagrees that the licensing exam, free webinars and 
symposiums, open access to governing statutes and regulations, etc., 
continue to be sufficient to ensure a professional and up-to-date 
broker community. For example, the licensing exam ensures an extensive 
and accurate knowledge base at a certain point in time. (Section 
111.102(a)(2) explicitly recognizes this reality and provides newly 
licensed individual brokers with a waiver of the continuing broker 
education requirement for the triennial period in which they receive 
their licenses.) However, the exam does not ensure that an individual 
broker will maintain an up-to-date knowledge base in the future, 
particularly when dealing with a very dynamic international trade 
environment that is changing frequently. Furthermore, free and easy 
access to CBP information and the regulations does not ensure 
individual brokers are taking advantage of access and staying informed. 
Accordingly, continuing education is required, and 36 continuing 
education credits over three years is a reasonable expectation of 
someone who holds a Federally issued, professional license.
    Comment: Multiple commenters stated that a continuing broker 
education requirement was an unnecessary expense and a burden on 
individuals and companies.
    Response: CBP disagrees that the continuing broker education 
requirement is an unnecessary expense and a burden. CBP has examined 
the costs and burdens that the continuing broker education requirement 
will place on individual brokers and companies and has determined it is 
not overly burdensome. See Section V, Statutory and Regulatory 
Requirements, below for more information. Furthermore, CBP will ensure 
that there will be free qualified continuing broker education 
activities available to individual brokers through CBP and other U.S. 
government agency offerings that is available on CBP's website CBP.gov.
    Comment: Multiple commenters requested that the continuing broker 
education requirement should not present additional costs to individual 
brokers.
    Response: CBP agrees in principle and does not intend to create a 
specific financial burden on individual brokers. There will be some 
burden imposed by the continuing broker education requirement because 
individual brokers will need to receive 36 continuing education credits 
over three years. However, CBP believes this burden will not be 
significant and has taken steps to lessen the burden. See Section V, 
Statutory and Regulatory Requirements, below for more information. For 
example, CBP will be providing enough free continuing education credits 
from CBP online modules and in-person events to cover the 36 continuing 
education credits required in a triennial period.
    Comment: Multiple commenters expressed concern that a continuing 
broker education requirement will have an outsized effect concerning 
time, expense, etc., on small businesses and individual brokers who are 
working for themselves.
    Response: CBP recognizes that this requirement will have an 
outsized impact on small businesses relative to larger firms. However, 
as more fully discussed in the Regulatory Flexibility Act section, CBP 
does not consider this rule to have a significant economic impact on a 
substantial number of small entities. See Section V, Statutory and 
Regulatory Requirements. While CBP realizes that a greater number of 
employees of smaller firms will be required to begin continuing 
education as a result of the rule, CBP designed the continuing broker 
education requirement so that it is the same for every individual 
broker. First, every individual broker is required to complete 
qualified continuing broker education and maintain his or her own 
records. Second, all qualified continuing broker education must be 
identified by CBP, as explained in Subsection G below, or accredited by 
a CBP-selected accreditor. As such, all individual brokers must 
complete the same requirements and the sources for completing those 
requirements are restricted in the same way. CBP does recognize that 
small businesses and individuals, sometimes operating in remote 
locations, may have a more difficult time finding accredited continuing 
broker education than individual brokers working in a larger entity in 
a metropolitan area. Therefore, CBP will ensure that there is a central 
location on CBP's website for individual brokers to access and find 
qualified continuing broker education. Additionally, as discussed in 
the comment response above, CBP will be offering enough free continuing 
education courses in the form of online modules and in-person events to 
cover the required 36 continuing education credits in a triennial 
period.
    Comment: Multiple commenters expressed concern that CBP may be 
creating a conflict of interest in setting continuing broker education 
requirements that would benefit CBP as an entity offering continuing 
broker education, may disadvantage other education providers, create a 
CBP education monopoly, or allow CBP to create a private education 
monopoly.
    Response: CBP disagrees that it is creating a conflict of interest 
that would benefit CBP. The new requirements will give individual 
brokers significant flexibility on how to meet the continuing broker 
education requirement. CBP intends for individual brokers to have 
access to a wide range of private- and public-offered qualified 
continuing broker education. CBP has provided free, online, education 
modules and in-person workshops to customs brokers, importers, and 
other members of the trade community for many years. The modules and 
workshops are designed to inform participants about practices and 
procedures when conducting customs business and provide updates to 
laws, regulations, and policies. CBP will continue to produce and 
disseminate the modules and workshops because doing so ensures that the 
trade community is aware of the most important changes or updates. More 
importantly, CBP will continue to offer the modules for free so that 
individual brokers have a baseline option to satisfy their continuing 
broker education requirement that will not allow the formation of a 
private continuing broker education monopoly and will ensure that CBP 
does not financially profit from instituting a continuing broker 
education requirement. CBP will work closely with CBP-selected 
accreditors to create standards that ensure robust and diverse private 
sector education offerings exist for individual brokers to access.
    Comment: Two commenters requested that qualified continuing broker 
education be administered by a government entity and stated that it 
should not be outsourced to any private parties.
    Response: CBP disagrees as it does not have the resource 
capabilities to create or administer all trainings or educational 
activities, nor does it have the capacity to vet or accredit every 
potentially valid training or educational

[[Page 41228]]

activity that could arise. As mentioned throughout this document, CBP 
believes a continuing broker education requirement will substantially 
benefit CBP, importers, exporters, customs brokers, and the trade 
community in general. CBP intends the continuing broker education 
requirement to be as attainable and as flexible as possible for 
individual brokers. Therefore, CBP has determined that a private sector 
continuing broker education option needs to exist, and that option 
needs to contain certain safeguards, explained elsewhere in this 
document, which guarantee individual brokers are receiving the 
requisite level of quality in the private sector offerings. However, 
CBP understands the commenter's concerns and believes that, by 
providing enough CBP-identified, free qualified continuing broker 
education alternatives, individual brokers will have the flexibility 
and alternatives that allow the individual broker to complete the 
continuing broker education requirement in a manner and at a cost that 
suits his or her individual needs.
    Comment: One commenter requested that the continuing broker 
education framework include fewer participating entities to allow for 
easier implementation and to avoid overwhelming or confusing individual 
brokers.
    Response: CBP disagrees that the number of participating entities 
should be limited. The continuing broker education program will involve 
as many parties as are necessary to provide individual brokers with a 
wide range of trainings, educational activities, and topics, while 
still being a manageable program. CBP believes individual broker 
confusion will be minimized by allowing an individual broker to certify 
that he or she has completed the continuing broker education 
requirement with the filing of the triennial status report and by 
allowing an individual broker to maintain his or her own records.
    Comment: One commenter asked CBP to hold monthly meetings in person 
or virtually with a uniform format to meet the continuing broker 
education requirement rather than the proposed process.
    Response: CBP already holds regular information sessions, local 
industry days, and conference calls to inform the trade community of 
changes in trade law, regulations, procedures, etc. However, CBP has 
found attendance to be sub-optimal and believes mandating attendance at 
such sessions would not provide individual brokers enough flexibility. 
CBP recognizes that many individual brokers specialize in certain 
areas, and not every topic or new development is equally important to 
every individual broker. As such, CBP has determined that the best 
approach to guarantee an informed customs broker community is to allow 
an individual broker to choose the topics he or she believes will help 
him or her stay current, informed, and effective in his or her practice 
area.

B. Certification Dates

    In the NPRM, CBP proposed that individual brokers be required to 
certify, with the filing of their triennial status reports, pursuant to 
19 U.S.C. 1641(g) and 19 CFR 111.30(d), the completion of 36 continuing 
education credits of qualified continuing broker education over the 
prior three years. Multiple commenters expressed concern or sought 
clarification regarding the requirement's initial and ongoing 
certification date.
    Comment: Two commenters sought clarification concerning the start 
and end dates of the three-year triennial period as it relates to the 
continuing broker education requirement. Specifically, the commenters 
sought clarification concerning the interaction between the end of a 
continuing broker education cycle and the triennial reporting period. 
One commenter suggested new dates for the continuing broker education 
cycle to better accommodate early filing of the triennial status 
report. One commenter suggested that CBP consider allowing brokers who 
exceed the 36-hour requirement for one triennial period to carry over 
and apply a limited number of continuing education credits to the 
subsequent triennial period.
    Response: CBP appreciates the opportunity to clarify. The timeline 
for triennial status reporting is prescribed by 19 U.S.C. 1641(g). 
Every three years after 1985 is a reporting year and a triennial status 
report is due on February 1st of the reporting year (the triennial 
reporting period). However, 19 U.S.C. 1641(g)(2) provides that a 
customs broker license is suspended only when a customs broker fails to 
file the required triennial status report by March 1st of the reporting 
year. CBP allows licensed customs brokers to file triennial status 
reports over a multi-month period, starting mid-December on a date 
announced on CBP's website and ending on the last day of February of 
the reporting year. CBP determined that requiring individual brokers to 
certify completion of continuing broker education requirements at the 
same time as filing the triennial status report would significantly 
simplify and alleviate administrative reporting burdens on individual 
brokers. CBP does not have discretion to adjust the triennial reporting 
period. As such, the 36-month cycle of the continuing broker education 
requirement will end on January 31st and begin on February 1st every 
three years coinciding with the due date of the triennial status 
report. That means participation in any qualified continuing broker 
education on or before the last day of January, marking the end of a 
triennial reporting period, can only count as qualified continuing 
broker education for that cycle. Any participation in qualified 
continuing broker education after the last day of January, marking the 
end of a triennial reporting period, can only count as qualified 
continuing broker education for the next three-year triennial reporting 
period. Individual brokers may continue to file their triennial status 
reports earlier than the due date but should be certain they have 
completed 36 continuing education credits in the slightly shorter 
timeframe. To respond to the last comment, CBP does not allow for 
individual brokers to carry over any continuing education credits they 
completed in one triennial period in excess of the 36-hour requirement 
into the subsequent triennial period. This requirement is meant to 
encourage individual brokers to maintain a current knowledge base by 
completing training or educational activities within a three-year 
period. Training or educational activities completed any time between 
three to six years prior to the credit being applied to the next 
triennial period would undercut that purpose.
    Comment: Two commenters requested that CBP implement the continuing 
broker education requirement with a delayed effective date. The 
commenters highlighted that a continuing broker education requirement 
is a significant change within the customs broker community and time 
must be given for the accreditation process to progress so that enough 
qualified trainings and educational activities are available for use by 
individual brokers. Similarly, one commenter requested that CBP 
establish an effective date that coincides with a complete triennial 
reporting period.
    Response: CBP agrees that time will be needed to set up the 
accreditation process. In this final rule, the first triennial 
reporting period that will require individual brokers to complete the 
continuing broker education requirement will close on January 31, 2027 
(with the triennial status report due on February 1, 2027). See 19 
U.S.C. 1641(g). As such, CBP is modifying Sec.  111.101 by adding a 
sentence to the

[[Page 41229]]

end of the section to make it clear that the requirement to certify 
completion of the continuing broker education requirement will be with 
the filing of the 2027 status report, and every status report 
thereafter. Therefore, the first time at which individual brokers will 
be required to certify completion of the continuing broker education 
requirement will be with the filing of the 2027 triennial status 
report. As discussed above, CBP will reduce the number of required 
continuing education credits for the triennial period beginning on 
February 1, 2024 and ending on January 31, 2027 by six credit hours for 
approximately every six month that elapse between February 1, 2024 and 
the compliance date on which individual brokers may begin meeting the 
requirement, as announced in a Federal Register notice following the 
publication of this final rule. Following the 2027 triennial status 
report, individual brokers will be required to certify completion of 
the 36-credit continuing broker education requirement with every 
triennial status report, unless an exception applies as outlined in 
Sec.  111.102(a).

C. Individuals to Whom the Requirement Applies

    In the NPRM, CBP proposed a continuing broker education requirement 
that applies to all individual brokers. CBP proposed that individual 
brokers who voluntarily suspended their licenses, under 19 CFR 111.52, 
and individual brokers who have not held their licenses for an entire 
triennial period, be excepted from the requirement. Multiple comments 
were received regarding the scope of the continuing broker education 
requirement, including to whom the requirement would apply.
    Comment: One commenter requested that the continuing broker 
education requirement not extend to those who are working at a 
brokerage firm or company because the person practices with customs 
rulings every day.
    Response: CBP disagrees because individual brokers working in a 
brokerage firm or company do not transact customs business differently, 
for the purposes of the continuing broker education requirement, from 
other individual brokers to warrant different treatment. Individuals 
transacting customs business are required to have a license unless 
specifically excepted. See 19 CFR 111.2(a). Any individual holding an 
active customs broker license will be required to certify completion of 
the continuing broker education requirement when submitting his or her 
triennial status report, with two limited caveats. Those caveats are: 
if an individual has not held his or her license for an entire 
triennial period or if an individual license is voluntarily suspended. 
If an individual has not held an active customs broker license for an 
entire triennial period or is reactivating a license that was 
voluntarily suspended, then that person is required to complete a 
prorated version of the requirement. In these two scenarios, the 
required number of continuing education credits that an individual 
broker must complete will be calculated on a prorated basis of one 
continuing education credit for each complete remaining month until the 
end of the triennial period. See 19 CFR 111.102(b). Furthermore, the 
continuing broker education requirement is not linked to the nature of 
the customs business the individual transacts. Individual brokers have 
different experiences, specializations, knowledge bases, and day-to-day 
interactions with customs business. Differentiating among individual 
brokers based on things such as experience, employer, or specialization 
would be unworkable and controversial. CBP believes the only fair and 
consistent way to implement the continuing broker education requirement 
is to apply the same requirement to all individual brokers.
    Comment: One commenter requested that CBP exempt individual brokers 
from the requirement if the licensee is not actively engaged in customs 
business.
    Response: CBP has determined that an individual holding an active 
license is the most fair and administrable distinction to determine 
whether an individual must complete qualified continuing broker 
education. In the NPRM, CBP explicitly stated that all individual 
brokers are required to complete the same continuing broker education 
requirement due to the complex and evolving realm of international 
trade. As mentioned above, on October 18, 2022, CBP published a final 
rule entitled ``Modernization of the Customs Broker Regulations,'' in 
the Federal Register, which substantially rewrote certain provisions of 
part 111 of title 19 of the CFR and made certain changes to 19 CFR 
111.30. As such, in this document, CBP has made technical and 
conforming changes to 19 CFR 111.30(d) while maintaining the original 
intent of the NPRM to apply the continuing broker education requirement 
to all individual brokers. CBP, through the Part 111 Rewrite, does 
recognize a difference, under 19 CFR 111.30, between the contents 
required in a triennial status report submitted by individual brokers 
``actively engaged in transacting business as a broker'' and brokers 
who are ``not actively engaged in transacting business as a broker.'' 
However, filing a triennial status report is required for non-active 
individual brokers and the continuing broker education requirement will 
be as well. CBP intends for all individual brokers to be current in 
their knowledge of transacting customs business and to complete the 
same continuing broker education requirement. Even brokers who are not 
actively engaged in transacting business as a broker might nonetheless 
be leveraging their broker license in other ways, for example, as an 
employee of a company or as a consultant. Furthermore, a broker could 
become active at any point in time from a period of inactivity and such 
brokers must then meet the same levels of professionalism and knowledge 
as any other broker who has been actively engaged in transacting 
business. Lastly, if a broker expects to not actively engage in 
transacting business as a broker for a longer period of time, then that 
broker could have his or her license voluntarily suspended in 
accordance with 19 CFR 111.52, and thereby, not be subject to the 
broker continuing education requirement during the period of voluntary 
suspension.
    Comment: One commenter asked CBP to extend the continuing broker 
education requirement to an importer or exporter who transacts customs 
business solely on his or her own account.
    Response: CBP disagrees with the request because those individuals 
do not need a customs broker license as they are not transacting 
customs business on behalf of others. CBP wants to ensure that licensed 
individual brokers who handle business on behalf of others and are paid 
for those services are knowledgeable and informed about the applicable 
laws and regulations in order to provide high quality service to their 
clients. CBP has consistently recognized that certain limited 
circumstances and certain specific individuals performing customs 
business do not require a license. See 19 CFR 111.2(a)(2). This final 
rule does not change the nature of, nor the reason for, those 
exceptions.
    Comment: One commenter requested that the continuing broker 
education requirement extend to CBP Officers and personnel.
    Response: CBP disagrees with this request because it is 
unnecessary. The duties and responsibilities of CBP Officers and 
personnel are significantly different from those of individual

[[Page 41230]]

brokers. The continuing broker education requirement is designed to 
address the needs, value, and credibility of individual brokers. This 
continuing broker education requirement is not designed for any other 
professional service involved in transacting customs business. It 
should be noted that CBP Officers and personnel do receive regular 
training to address their dynamic environments as well as to conduct 
compliance and enforcement activities related to new laws, regulations, 
and policies.

D. Completing the 36 Continuing Education Credits

    In the NPRM, CBP proposed that individual brokers complete 36 
continuing education credits of qualified continuing broker education 
over the three years of a triennial period. CBP also created a 
definition for continuing education credit. CBP received many comments 
regarding the definition of continuing education credit and hours 
required.
    Comment: Many commenters expressed agreement with CBP that 36 
continuing education credits of qualifying continuing broker education 
each triennial period is a reasonable and attainable requirement.
    Response: CBP agrees and notes that 36 continuing education credits 
over three years is easily prorated as circumstances dictate. For 
individual brokers, one credit per month should be easy to track and 
provide sufficient time to identify qualified continuing broker 
education opportunities capable of meeting the requirement.
    Comment: One commenter felt that 36 continuing education credits 
should be required annually and not per every triennial period.
    Response: CBP disagrees with this commenter because requiring 36 
credits of continuing broker education every triennial period is 
attainable and easily prorated when necessary. CBP believes that 
requiring significantly more continuing education credit in an annual 
or triennial period would significantly increase the burden of the 
continuing broker education requirement on all individual brokers and 
may increase non-compliance with the requirement. CBP does not intend 
to create a new barrier for individuals seeking or maintaining a 
customs broker license that outweighs the benefits of continuing broker 
education.
    Comment: One commenter requested that small businesses or 
businesses with under 10 employees be required to complete fewer 
continuing broker education credits, such as 24 credit hours.
    Response: CBP disagrees with this request to lower the number of 
credit hours. Requiring the same number of credit hours ensure fairness 
and a similar level of education for all brokers. Furthermore, CBP has 
assessed the effect of this final rule on small businesses, which may 
be reviewed below in Section V, Statutory and Regulatory Requirements. 
CBP has determined that there would not be a significant economic 
impact on small businesses. CBP believes that completing 36 continuing 
education credits over the span of three years will not be a 
significant hurdle for individual brokers or the businesses with which 
they are associated, regardless of the business size, especially given 
the availability of low-cost or free options.
    Comment: Many commenters requested that CBP recognize the smallest 
unit of continuing broker education credit as a 30-minute half credit 
due to the frequency of trainings and educational activities offered 
for this length of time.
    Response: CBP agrees and has adopted this suggestion in the final 
rule by revising the definition of continuing education credit found in 
the proposed amendments to Sec.  111.1. The NPRM had proposed that the 
first continuing education credit provided by a qualified continuing 
broker education provider must be one hour of continuous participation 
in the activity and additional half credits would be approved for each 
30 minutes of continuous participation in continuing education 
thereafter. In this final rule, qualified continuing broker education 
may award half a credit for 30 minutes of continuous participation and 
an additional half a credit for each full 30 minutes of continuous 
participation in continuing education thereafter. CBP believes 
individual brokers should have the maximum flexibility to complete the 
continuing broker education requirement. Allowing half credit trainings 
or educational activities provides for more specialization of topics 
and more diversity among qualified continuing broker education 
opportunities available to individual brokers. In addition, CBP 
modified the proposed language in Sec.  111.103(b)(1) to allow 
instructors, discussion leaders, and speakers to claim half of one 
continuing education credit for each full 30 minutes spent on 
presenting or preparing for a presentation at a training or educational 
activity as described in Sec.  111.103(a)(2)(i) and (ii).
    Comment: Many commenters requested that CBP award one full credit 
for every fifty-five (55) minutes of continuing broker education to 
allow for breaks, technical issues, etc.
    Response: CBP understands the sentiment and logic behind accounting 
for variance, but believes the issue is better addressed outside of 
regulation. For the sake of simplicity and clarity, one credit of 
qualifying continuing education must come from a training or 
educational activity that adds up to one continuous hour in length (the 
time could be one full continuous hour or two full continuous 30-minute 
segments). CBP recognizes that variances will always exist in how a 
presenter performs, how much the audience participates, how a 
participant clicks through an online module, etc. The existence of 
those variances is one of the many reasons CBP is requiring that 
qualifying continuing broker education be accredited. Accreditation 
allows standardization of how many continuing education credits are 
rewarded from any given activity and will allow for technical 
difficulties, breaks, etc., to be accounted for and measured 
consistently. The number of continuing education credits assigned to 
government-offered trainings and educational activities will follow the 
same standards as those for accreditation.
    Comment: One commenter noted that eligibility on receiving 
education credits should be based on the amount of time designated for 
the material rather than the minutes of continuous participation.
    Response: CBP disagrees as each qualified continuing education 
activity will provide continuing education credit based on the 
predetermined amount of continuous participation required to complete 
the training or educational activity. The actual amount of continuous 
participation that a specific individual broker takes is not relevant 
to the calculation. Basically, qualified continuing broker education 
will have a specific number of continuing education credits assigned 
based on a determination of the number of continuous 30-minute 
participation segments required to complete the activity. Activity 
extending over 30 minutes must have another 30 minutes of continuous 
participation (totaling one hour of continuous participation) to then 
count as one continuing education credit and the calculation continues 
for longer continuing broker education. However, a training or 
educational activity requiring 45 minutes of continuous participation 
will only count for half a continuing education credit. Time spent 
allowing for breaks, pauses, technical issues, excess time answering 
questions, etc., will not adjust the quantity of continuing

[[Page 41231]]

education credits that an activity will provide. CBP or CBP-selected 
accreditors will pre-approve the continuing education credit for all 
qualified continuing broker education. Individual brokers will know the 
number of continuing education credits before participating in an 
activity.
    Comment: Multiple commenters highlighted the private sector 
Certified Customs Specialist (CCS) designation/certification and 
continuing education program. The commenters specifically asked whether 
the CCS certification and continued maintenance of the certification 
would qualify brokers as having met the 36 continuing education credits 
required in a triennial reporting period for the continuing broker 
education requirement.
    Response: Until CBP selects accreditors, CBP cannot say for certain 
whether the education requirement for a CCS certification will meet the 
continuing broker education requirement of this final rule. CBP has not 
evaluated the specific training materials required or ``continuing 
education units'' (CEU) required to attain the CCS certification. In 
accordance with this final rule, only qualified trainings or 
educational activities will provide individual brokers with continuing 
education credit. As of now, there are no qualified trainings or 
educational activities because CBP has not identified nor have any CBP-
selected accreditors accredited any trainings or educational 
activities. However, CBP envisions future accreditors will likely 
determine that trainings and educational activities designed for CCS 
certification and CEUs will qualify as continuing broker education 
under Sec.  111.103, given the history of this certificate program and 
its reputation in the brokerage community. See the economic analysis 
presented below in Section V, Statutory and Regulatory Requirements.
    Comment: One commenter noted that an individual broker should be 
allowed to choose which specific trainings to attend based on his or 
her specific needs and general business environment.
    Response: CBP agrees that individual brokers should be allowed to 
choose trainings to attend based on their specific needs. The 
continuing broker education requirement was designed to provide 
individual brokers the maximum flexibility to complete the requirement 
from qualified sources. These regulations do not require individual 
brokers to fill the 36 continuing education credits with specific 
trainings or educational activities, such as ethics trainings. 
Individual brokers are encouraged to seek the trainings, educational 
activity, and topics that best suit their needs during each triennial 
period. Furthermore, the 36 continuing education credits can be 
completed at any time during the triennial period.

E. Recordkeeping

    In the NPRM, to comply with the continuing broker education 
requirement, individual brokers must certify completion of 36 
continuing education credits at the time of filing their triennial 
status report and must maintain certain records of the qualified 
continuing broker education completed for three years after certifying 
completion and make those records available to CBP upon request. In 
proposed Sec.  111.02, CBP also proposed the minimum data elements 
required to appear in the maintained records concerning each qualified 
training or educational activity completed. CBP received multiple 
comments regarding recordkeeping requirements and procedures.
    Comment: One commenter requested that CBP should consider 
alternatives to the proposed recordkeeping requirements and allow for 
an individual broker to be able to retain an extract of completed 
coursework from an employer's learning management system.
    Response: CBP agrees with the commenter and the regulations will 
allow individual brokers such flexibility regarding the location where 
records may be stored. Individual brokers will be in compliance with 
the recordkeeping requirement so long as the broker's records meet the 
criteria of Sec.  111.102(d)(1), and the individual broker is capable 
of producing the records in a timely manner if requested by CBP. The 
customs broker license is held by the individual and the responsibility 
to maintain the license requirements rests with the individual broker. 
The requirements in Sec.  111.102(d) are designed to provide individual 
brokers with the flexibility to maintain their continuing broker 
education records in a manner best suited for them. If an individual 
broker chooses to maintain all or some of his or her records within an 
employer's learning management system that is his or her prerogative, 
but nonetheless the individual broker remains responsible for 
recordkeeping requirements.
    Comment: Multiple commenters requested that CBP should recognize a 
transcript or similar electronic certification as encompassing all the 
essential information for recordkeeping requirements. Additionally, one 
commenter requested that records that are kept in the normal course of 
business should meet the standard for required documentation or that 
CBP should not require a specific form or format.
    Response: CBP agrees with the commenters and intends for individual 
brokers to have such flexibility maintaining the records of the 
continuing broker education credits in whatever format is convenient 
for the individual broker. For that reason, proposed Sec.  111.102(d) 
had been written to be very general and this final rule adopts the 
proposed language. If an individual broker's records are complete, 
contain 36 continuing education credits in a triennial period, and each 
credit can be connected to the six criteria (Sec.  111.102(d)(1)(i-
vi)), the individual broker will be in compliance. The record may be 
either physical or electronic and evidentiary documentation of activity 
or training completion may be physical or electronic. A transcript or 
similar electronic certification will suffice and, CBP anticipates the 
identification and accreditation processes will ensure qualifying 
trainings and educational activities provide individual brokers with 
the necessary information and documentation of completion meeting the 
requirements of Sec.  111.102(d). However, it will be incumbent on an 
individual broker to maintain his or her records in a form that allows 
the individual broker to easily and timely respond to CBP record 
requests.
    Comment: One commenter sought greater clarity concerning how 
individual brokers will be able to prove completion of government-
created continuing broker education trainings or educational activity.
    Response: As explained elsewhere in this preamble, CBP is working 
with Partner Government Agencies (PGAs) to identify specific 
government-provided online modules and in-person activities that are 
relevant to customs business as qualifying continuing broker education. 
CBP will assign the appropriate continuing education credit to the 
qualified continuing broker education. CBP will work with PGAs to 
provide information or a record, upon training or activity completion, 
to individual brokers to satisfy the requirements of Sec.  
111.102(d)(1)(i-vi). However, the exact format of the provided record 
will be determined after CBP has selected accreditors and leveraged 
their expertise to create consistency for individual brokers between 
private and public offerings. CBP will provide additional information 
on its website, CBP.gov, in the future.

[[Page 41232]]

    Comment: One commenter recommended that recordkeeping requirements 
should be extended to all accredited entities providing continuing 
education for individual brokers so that individual brokers can rely 
upon the continuing education organization to provide a record directly 
to CBP.
    Response: CBP disagrees because records held by providers of 
accredited trainings and educational activities will not produce data 
that is easily usable by CBP nor is such a system helpful to individual 
brokers to ensure that the required number of credits has been 
completed. Simply put, records maintained by providers of accredited 
continuing broker education will only demonstrate which individuals 
attended the provider's specific trainings and educational activities. 
That data is only useful when reorganized and collated with data from 
other providers and individual brokers. Such a system is highly 
susceptible to failure, and the failure would generally fall outside 
the control of individual brokers even though the individual brokers 
have the duty to complete the requirement. The chosen recordkeeping 
requirements place the responsibility of recordkeeping on the 
individual broker, who is in the best position to maintain the records.
    Comment: One commenter requested that CBP develop an online 
reporting portal. Similarly, another commenter asked CBP to develop a 
means of tracking verifiable continuing education credits through the 
Automated Commercial Environment (ACE) system.
    Response: CBP disagrees as it cannot commit to the development of a 
tracking tool on CBP.gov or through ACE. CBP may pursue developing an 
online reporting/ACE tracking tool, but the development of this tool 
will be dependent on resources and CBP priorities. For that reason, CBP 
has made the requirements of Sec.  111.102(d) very general and flexible 
for individual brokers to meet. CBP does anticipate individual brokers 
will only need to check a box certifying completion of 36 continuing 
education credits when filing their triennial status reports in the 
electronic Customs and Border Protection (eCBP) Portal.\9\
---------------------------------------------------------------------------

    \9\ The eCBP Portal and additional information may be accessed 
through https://e.cbp.dhs.gov/ecbp/#/main.
---------------------------------------------------------------------------

    Comment: One commenter mentioned that a CCS certificate presented 
to the individual broker should satisfy the recordkeeping requirement. 
The commenter also asserted that the CCS certificate should suffice as 
proof of completing the continuing broker education requirement and 
obviate the need to keep individualized records of each activity 
completed.
    Response: CBP understands the commenter's concerns, however, 
neither CBP nor a CBP-selected accreditor has formally evaluated 
whether documents demonstrating CCS certification meet the continuing 
education requirements. Without formal evaluation, the CCS 
certification cannot be used to meet the requirements. The 
recordkeeping requirement in Sec.  111.102(d) requires the individual 
brokers to maintain a record that states the title, provider, date, 
credits, and location of accredited activity completed, along with 
documentary evidence of an individual ``broker's registration for, 
attendance at, completion of, or other activity bearing upon the 
individual broker's participation in and completion of the qualifying 
continuing broker education.''
    Comment: Two commenters noted confusion concerning proposed Sec.  
111.102(d)(1)(v), regarding the requirement to maintain documentation 
pertaining to the location of the training or educational activity, and 
the paragraph's interaction with training done via webinars or other 
online courses.
    Response: Proposed Sec.  111.102(d)(1)(v) requires that records be 
maintained as to ``[t]he location of the training or educational 
activity, if the training or educational activity is offered in 
person.'' To clarify that CBP does not differentiate between in-person 
and online training or educational activity, CBP slightly revised the 
proposed provision to require that the record include the location of 
the qualifying continuing education. For trainings or educational 
activity offered electronically, such as via webinar or online course, 
the individual broker may simply record the location of the activity as 
``online.''
    Comment: Two commenters sought additional information concerning 
CBP requests for continuing education records under proposed Sec.  
111.102(d)(2), including the time brokers will have to provide the 
documentation, whether a set/standardized review will be conducted, and 
whether the record request would be conducted onsite or electronically. 
Additionally, many commenters requested that CBP should provide a 
reasonable timeframe (such as 30 days) for submission of records, 
particularly when requesting an in-person inspection, under proposed 
Sec.  111.102(d)(2), in case the broker is away or unavailable.
    Response: The focus of a record request is to ensure compliance 
with the continuing broker education requirement by reviewing records 
maintained in accordance with Sec.  111.102(d)(1). Individual brokers 
must maintain those records in a manner that is capable of retrieval 
under Sec.  111.102(d)(2). CBP recognizes the recordkeeping requirement 
is new and will work closely with individual brokers to accommodate the 
transition. CBP agrees that it is important for brokers to have a 
reasonable timeframe in place for the submission of records upon 
request, and thus, CBP added a 30-calendar day timeframe from the date 
of receipt of CBP's record request in the first sentence of Sec.  
111.102(d)(2), which is in accordance with general recordkeeping 
requirements in 19 CFR part 163. As with other broker matters, CBP will 
work with the individual broker to ensure production of the records 
requested in a manner and timeframe that is feasible for CBP and the 
individual broker.

F. CBP-Selected Accreditors

    In the NPRM, CBP proposed that qualified continuing broker 
education must either be created by the government or accredited by a 
CBP-selected accreditor. CBP also outlined the process for selecting 
accreditors and the responsibilities of CBP-selected accreditors. CBP 
received comments regarding the selection criteria and process for 
selecting accreditors.
    Comment: One commenter requested that CBP become an accreditor 
because it would give CBP the ability to monitor the training that 
individual brokers are receiving, provide for a cost-efficient 
accreditation process, and provide individual brokers with a secure 
accreditor to prevent disclosures of confidential business processes.
    Response: CBP disagrees as CBP believes a public-private 
partnership is necessary to ensure the best qualified continuing broker 
education opportunities for individual brokers. CBP will select 
accreditors and the process will provide CBP with a sufficient window 
into the types of trainings and educational activities receiving 
accreditation. Additionally, CBP will institute a framework for the 
trade community to inform CBP of issues or make suggestions concerning 
continuing broker education. Furthermore, CBP does not have the 
capacity to vet all potential trainings and educational activity for 
accreditation, which would likely occur if CBP were to act as a ``cost-
efficient'' accreditor alternative. Finally, the limitations and 
requirements placed on parties to maintain their accreditor status will 
prevent disclosure of

[[Page 41233]]

confidential business processes. As such, CBP needs to ensure there is 
room in the continuing broker education process for private parties to 
operate.
    Comment: Multiple commenters expressed the belief that CBP's 
proposed selection of accreditors through SAM would be too cumbersome 
and time-consuming due to additional and more detailed technical 
requirements. The commenters also requested that CBP adopt a 
streamlined accreditation process akin to that used for commercial 
laboratories that are approved by CBP.
    Response: CBP disagrees that the SAM process would be too 
cumbersome. SAM is familiar to the public and its use is appropriate in 
this circumstance. CBP has determined that selection of accreditors 
will require a contracting-type process. All potential accreditors must 
be afforded the same access and same opportunity to present their 
credentials. The system for accrediting commercial laboratories is very 
involved (including site visits), specific to the unique requirements 
placed on laboratories addressing concerns about human health and 
safety and is unnecessary in these circumstances. CBP will only be 
vetting parties for their capabilities to be accreditors and ensure 
those selected parties understand the standards for qualified 
continuing broker education. The accreditation process, discussed above 
in Section I, requires response to an RFI and RFP, which will produce a 
binding agreement between the selected party and CBP. The RFI and RFP 
process will ensure a more dynamic and responsive vetting process and 
produce a diverse pool of accreditors.
    Comment: One commenter requested that if an applicant's proposal to 
be an accreditor is deficient for any reason, or if CBP intends to deny 
the proposal, that the applicant be advised in writing of any 
deficiency and provided with a reasonable opportunity to amend the 
proposal.
    Response: In accordance with Sec.  111.103(c), the application 
process to be an accreditor will be conducted via SAM following the 
announcement of an RFI and an RFP. The normal process for responding to 
RFIs and RFPs will apply. All parties desiring to participate as an 
accreditor should carefully review the RFIs and RFPs and carefully 
respond to the instructions of the RFIs and RFPs.
    Comment: Multiple commenters requested that certain specific 
parties be automatically recognized as accrediting organizations 
without CBP selection, and that this designation should continue 
indefinitely unless complaints are filed, and a study shows that the 
party has not fulfilled its obligations as an accreditor.
    Response: CBP disagrees with these comments. No private party will 
simply be designated as an accreditor without any review process. All 
parties wishing to be an accreditor will have the same opportunity to 
submit proposals and demonstrate their credentials.
    Comment: One commenter noted the importance of having a transparent 
application process with multiple approved accreditors and agreed that 
CBP-selected accreditors should be required to renew their accreditor 
statuses on a periodic basis.
    Response: CBP agrees and intends for the RFI and RFP process to be 
transparent and produce multiple qualified accreditors. CBP anticipates 
that the accreditation process will require adjustment over time to 
address standards, add new accreditors, address substandard 
accreditors, etc. As such, CBP will have accreditor status sunset and 
publish new RFIs and RFPs to select new accreditors as circumstances 
require. The first set of CBP-selected accreditors will be approved for 
three years.
    Comment: One commenter requested that the term of third-party 
accreditors be extended to six years from the date of approval.
    Response: CBP disagrees because the continuing broker education 
requirement is new, and the public-private partnership envisioned to 
designate accredited continuing broker education for individual brokers 
needs flexibility and a period of applied learning. The period of award 
must be the same for all parties selected, it must provide enough time 
for the selected accreditors to establish their systems, it must be 
short enough to allow new interested parties to enter without waiting 
too long, and it must be long enough to allow selected parties to 
accredit sufficient trainings and educational activities. CBP has 
determined three years is an appropriate period of time and allows CBP 
to ensure that the accreditor selection process does not interfere with 
the close of a triennial period. CBP may adjust the contracted period 
in future RFIs and RFPs as circumstances and hindsight dictate the best 
practice.
    Comment: Two commenters requested that CBP include specific 
criteria in proposed Sec.  111.103 that describes required criteria for 
accreditors.
    Response: CBP disagrees with these commenters and will not add 
criteria to the regulations at this time. There will be criteria for 
vetting the proposals received in accordance with Sec.  111.103(c). 
However, CBP anticipates the criteria will change as CBP makes the 
first selection of accreditors and then evaluates the outcomes. 
Therefore, including accreditor criteria in CBP's regulations would be 
too restrictive at this juncture. The accreditor criteria will be 
outlined in the RFP issued to solicit potential accreditors, and the 
RFP is a public document that any party can review.\10\
---------------------------------------------------------------------------

    \10\ RFPs may be viewed by the public online at www.sam.gov.
---------------------------------------------------------------------------

    Comment: One commenter requested that the employment of a licensed 
broker be treated as a factor, but not a requirement, to becoming an 
accreditor.
    Response: CBP disagrees with the commenter, as a licensed broker 
has passed the exam and has the requisite knowledge to vet trainings 
and educational activities. CBP believes that parties without a 
licensed customs broker on staff will have problems vetting trainings 
and educational activities and may accredit inferior continuing broker 
education. CBP is cognizant that individual brokers deserve qualified 
continuing broker education that is useful and accurate. The best way 
to ensure that accredited trainings and educational activities meet 
minimum standards is to have the continuing education vetted by 
licensed customs brokers. As such, and as stated in the NPRM, 
employment of a licensed customs broker will be a requirement for a 
party to be an accreditor. CBP may adjust this requirement in future 
RFIs and RFPs as circumstances dictate.
    Comment: Multiple commenters expressed concern about non-
governmental accreditors receiving access to confidential business 
procedures that a business would not want shared with its competitors.
    Response: CBP appreciates this concern and notes that business 
procedures are not necessarily outside the scope of continuing broker 
education if they relate to transacting customs business. However, CBP 
believes protections related to confidentiality are not appropriate for 
this regulation and better addressed in the RFPs and in limitations and 
security expectations placed on accreditors selected by CBP as a 
requirement/condition to maintain their accreditor status.

G. Qualified Continuing Broker Education

    In the NPRM, CBP proposed basic standards for trainings and 
educational activities to qualify as continuing broker education and 
provide individual brokers with continuing education credit. CBP also 
proposed specific

[[Page 41234]]

allowances for instructors, discussion leaders, and speakers to receive 
limited continuing education credit. CBP received multiple comments 
regarding the validity and type of trainings and educational activities 
available.
    Comment: Multiple commenters specifically requested information on 
how an individual interested in continuing broker education will be 
able to identify appropriate courses or programs.
    Response: Following publication of the Federal Register notice 
announcing the availability of qualified continuing broker education 
courses, CBP will publish the initial list of available qualified 
continuing broker education opportunities on CBP.gov. Furthermore, CBP 
will ensure there is a central location on CBP.gov that allows 
individual brokers to identify and link to all available qualified 
continuing broker education opportunities.
    Comment: Two commenters requested additional information regarding 
how individual brokers will be able to confirm the validity of any 
accreditations that a continuing education provider claims to hold.
    Response: CBP and the CBP-selected accreditor will not be 
accrediting education providers but specific trainings and educational 
activities. CBP anticipates individual brokers will have several ways 
to determine what trainings and educational activities are accredited 
and count for continuing education credit. First, CBP will announce 
every party that is a CBP-selected accreditor, and the accreditor will 
provide an open access list that tracks every training and educational 
activity accredited by that accreditor. Second, CBP will maintain a 
central location on CBP.gov that lists the accreditors, provides links 
to the accreditors' listings, and provides access to CBP and PGA 
continuing broker education opportunities. CBP is exploring additional 
avenues to inform brokers of available qualified continuing broker 
education.
    Comment: One commenter requested that CBP develop a web page on 
CBP.gov listing all available qualifying training materials provided by 
CBP and PGAs.
    Response: CBP agrees and intends to do so after CBP has identified 
a sufficient quantity of qualified trainings and educational activities 
to include on CBP.gov. The specific page will be announced at a later 
date.
    Comment: One commenter requested that public meetings, webinars, 
and other activities, hosted by CBP, be clearly identified as 
qualifying or not qualifying for continuing education credit.
    Response: CBP agrees that qualifying events hosted by CBP should be 
clearly identified. The NPRM had proposed that all CBP and other PGA 
trainings and educational activities relevant to customs business would 
be qualified continuing broker education. In this final rule, CBP is 
modifying proposed Sec.  111.103(a)(1)(i) to explicitly state that CBP 
will identify when a government-offered training or educational 
activity is related to customs business and qualified continuing broker 
education. This modification will ensure that individual brokers will 
be directly informed of when they will receive continuing education 
credit from government offerings and avoid confusion concerning what 
qualifies or require individual brokers to parse the scope of 
``relevant to customs business'' on their own. After consultation with 
the relevant PGA, CBP will identify and collect all existing CBP and 
PGA trainings and educational activities into one online location with 
specific details concerning the number of continuing education credits 
assigned to each. Furthermore, CBP will clearly identify what future 
events qualify as continuing broker education and the continuing 
education credits connected to the events.
    Comment: Multiple commenters stated that continuing broker 
education should not be limited to customs business in the narrow sense 
and should involve the full range of PGAs with border clearance 
responsibilities.
    Response: CBP agrees with the commenters in principle. CBP intends 
for the continuing broker education requirement to be flexible and 
relevant to individual brokers. CBP recognizes that transacting customs 
business can cross many issue areas and involve statutes, regulations, 
policies, and procedures of governing agencies besides CBP. As such, 
CBP has modified proposed Sec.  111.103 such that, ``training or 
educational activity offered by another U.S. government agency'' will 
qualify as continuing broker education as long as ``the content is 
relevant to customs business as identified by CBP in coordination with 
the appropriate U.S. government agency when applicable.'' CBP believes 
``relevant to customs business'' provides CBP the ability to ensure 
individual brokers will have access to a wide variety of education 
topics that cover the range of Trade issues involving other government 
agencies. As previously noted and in Section II, for the sake of 
clarity, CBP will clearly identify the government-offered trainings and 
educational activity, in coordination with PGAs when applicable, that 
qualify as continuing broker education.
    Comment: One commenter requested additional guidance concerning the 
specific training and educational activities that CBP will accept from 
other government agencies and provide a list of pre-approved programs 
from other government agencies.
    Response: CBP cannot at this point provide additional guidance 
concerning the specific PGA trainings or educational activities that 
will qualify as continuing broker education. CBP is working with PGAs 
to determine what trainings and educational activities exist, what 
should be identified as qualified continuing broker education, and the 
number of continuing education credits assignable to each. CBP will 
provide individual brokers with a list of qualified PGA and CBP 
offerings in an online format. CBP will update the list as new PGA and 
CBP trainings and educational activities are available and identified 
by CBP as relevant to customs business.
    Comment: Multiple commenters sought clarification concerning the 
cost and credit hours of qualified continuing broker education offered 
by CBP or PGAs.
    Response: Nearly all CBP and PGA-offered trainings and educational 
activities that will be eligible for continuing broker education credit 
will, as they are now, be offered at no cost to interested 
participants. The number of continuing education credits associated 
with any given training or educational activity will depend upon the 
same criteria dictating continuing education credit assigned by 
accreditors. Additionally, CBP believes, based on existing modules, 
planned modules, and regularly scheduled events, that CBP will provide 
individual brokers enough qualified continuing broker education that 
they will be able to fulfill the continuing broker education 
requirement from the CBP and PGA offerings alone.
    Comment: Two commenters requested further information as to the 
meaning of qualifying education. The first commenter requested that CBP 
adopt a clear set of guidelines as to what constitutes education, 
potentially including practical case studies and a list of overarching 
trade topics and aspects of professional development, and second 
commenter requested that CBP adopt a more specific definition of 
training and educational activities.
    Response: CBP disagrees with the comments requesting that CBP 
establish a more specific definition and guidelines as to what 
constitutes

[[Page 41235]]

education. CBP recognizes that flexibility is necessary in this field 
to ensure that an adequate quantity and the best quality of qualified 
continuing broker education is available for individual brokers. At 
this time, a more precise definition, definitive guidelines, or lists 
of what constitutes permissible trainings, educational activities, or 
topics, more detailed than what appears in Sec.  111.103(a) is not 
practical. CBP, in conjunction with the CBP-selected accreditors, will 
establish standards and guidelines for continuing broker education. CBP 
will provide further updates in the future.
    Comment: Many commenters requested that CBP edit the language of 
the requirements for recognized trainings or educational activities in 
proposed Sec.  111.103(a)(2) because it does not allow for 
``asynchronous delivery of on-line training'' or ``self-guided 
learning'' which can be completed by students on a self-paced, anytime-
anywhere basis.
    Response: CBP agrees with these comments and has always intended 
for self-guided online modules to be viable sources of continuing 
broker education credit because they represent a significant expansion 
of the types of education available to individual brokers. The language 
proposed in the NPRM does not explicitly prohibit self-guided online 
modules, but the consistent confusion in the comments received has 
demonstrated that an amendment and additional clarity is warranted. As 
such, CBP has added a new subparagraph, Sec.  111.103(a)(2)(iii), to 
explicitly allow for online training and educational activity, whether 
live or self-guided, that culminates in a retention test. Accordingly, 
CBP has also renumbered the other four categories and edited proposed 
Sec.  111.103(a)(2)(i) so that it is clearly delineated from Sec.  
111.103(a)(2)(iii), as trainings or educational activity that are led 
or guided by another individual. This change will allow individual 
brokers to engage in qualified self-guided learning that also 
guarantees a minimum level of engagement from the participant.
    Comment: One commenter sought clarification regarding whether 
online training may be offered in a recorded format, i.e., given by a 
speaker who records a script of accredited content.
    Response: Online training may be offered in a recorded format if 
the recording of the script has been approved for continuing education 
credit by a CBP-selected accreditor. Simply recording an individual 
reciting content that appears in a different accredited activity will 
not suffice as continuing education on its own merits. The entire 
recording must be submitted to a CBP-selected accreditor and 
accredited. Further, proper documentation of the training must also be 
available to make clear that the broker received the training from an 
accredited source and that verifies proper completion of the course.
    Comment: One commenter sought clarification regarding whether 
online training may be in the form of a slide presentation of 
accredited content.
    Response: CBP agrees that online training may be in the form of 
slides if the entire slide deck has been approved for continuing 
education credit by a CBP-selected accreditor. Please note the changes 
discussed above, and in Section II, concerning online self-guided 
learning. Simply taking content or slides that appear in a different 
accredited activity and combining them into a new presentation will not 
suffice as continuing education on its own merits. The specific online 
training must be submitted to a CBP-selected accreditor and accredited.
    Comment: One commenter requested that qualified continuing broker 
education should be permitted in either a classroom setting or online, 
as long as such training is taught or overseen by a licensed customs 
broker, a trade attorney, an experienced consultant, or a qualified 
representative of CBP or any PGA.
    Response: CBP disagrees with the commenter to the extent this 
comment seeks an exemption from accreditation if the training is 
provided by such private individuals. To the extent the commenter seeks 
to restrict presentation of training to the listed persons, then CBP 
disagrees with the comment because the request is unnecessarily 
restrictive. If a training or educational activity qualifies as 
continuing broker education under Sec.  111.103(a) then it will provide 
continuing education credit upon completion. The identity of the 
presenter, instructor, or other attendees is not relevant.
    Comment: One commenter requested that CBP allow individual brokers 
to earn continuing broker education credit for time spent publishing 
subject matter for an accredited course even if the license holder 
preparing the material is not an instructor, discussion leader, or 
speaker.
    Response: CBP disagrees with this comment because allowing credit 
for publication would be unworkable and controversial. CBP does not 
believe there is a consistent manner to determine how significant an 
individual's engagement with material is when involved in the 
publication of educational material. Furthermore, CBP believes that 
determining when to allocate credits for publishing material would be 
very controversial and difficult because trainings and educational 
activities must be accredited before they may count as continuing 
broker education credit. Certain individual brokers may rely upon 
publication and then accreditation to meet their continuing broker 
education requirements and fail to meet the 36 continuing education 
credits required because an activity is not accredited or does not 
provide enough credit. CBP believes clarity and consistency are 
essential to allow individual brokers to meet this new requirement and, 
therefore, no credit will be awarded for publishing education 
materials.
    Comment: Two commenters suggested that CBP reconsider its proposal 
to prevent participation in various federal advisory committees from 
counting as continuing education.
    Response: CBP disagrees because participation in federal advisory 
committee meetings is considered a privilege, and the meetings do not 
serve an educational purpose. As stated in proposed Sec.  
111.103(a)(2)(ii), meetings that are conducted in accordance with the 
provisions of the Federal Advisory Committee Act, as amended (5 U.S.C. 
App.) (FACA), are expressly excluded as qualified continuing broker 
education. Individual brokers will not be permitted to claim continuing 
education credit for their participation in committees, subcommittees, 
workgroups, and any other group organized under the auspices of FACA, 
including participating in public meetings. Instead, FACA meetings 
serve to solicit advice from committee members and to receive input 
from the public that may later form the basis for government decisions. 
Not all activities relating to customs business qualify as education, 
and participation in FACA meetings does not qualify as a training or an 
educational activity.
    Comment: One commenter requested that a company's in-house training 
should not be an eligible option for continuing education credit, 
whether approved by an accreditor or not.
    Response: CBP disagrees with the commenter because declaring in-
house training as being unqualified to be continuing broker education 
would not provide the flexibility to produce the best quality and 
quantity of continuing broker education opportunities for individual 
brokers. In-house training is also, presumably, intended to provide 
individuals within the company the most relevant information on that

[[Page 41236]]

company's processes and best practices, something that is vital to a 
business's viability and can be inextricably intertwined with 
legitimate topics concerning transacting customs business. Greater 
guidance, restrictions, or even liberalization of what constitutes 
qualified continuing broker education will come after CBP has selected 
accreditors and consulted with them on working guidelines for 
accrediting continuing broker education.
    Comment: One commenter sought clarification regarding whether the 
presenter or speaker of accredited content is required to have certain 
qualifications.
    Response: CBP will not require that the presenter of an accredited 
training or educational activity have any specific qualifications. CBP 
does not require presenters of education material for the customs 
broker exam to have specific qualifications and will not require such 
qualifications for the presentation of continuing broker education.

H. The Accreditation Process

    In the NPRM, CBP proposed regulations detailing the 
responsibilities of CBP-selected accreditors. CBP also specified a 
limitation on a CBP-selected accreditor's ability to accredit the 
entity's own educational activity. CBP reviewed multiple comments 
regarding the accreditation process.
    Comment: Multiple commenters requested that educational activity 
(membership meetings, seminars, etc.) offered by broker associations 
should not require third-party accreditation.
    Response: CBP disagrees because the continuing broker education 
requirement is new, and no existing trainings or educational activities 
have been developed with the specific needs of this requirement in 
mind. Any training or educational activity, not offered by CBP or other 
U.S. government agency, seeking to provide continuing education credit 
must be accredited. If existing trainings or educational activities 
qualify, based on their content and quality, then the activities will 
receive accreditation.
    Comment: Many commenters requested that a continuing broker 
education program provider should have the option to apply for and 
obtain accreditation after the training or educational activity is 
provided.
    Response: CBP disagrees because post-event accreditation could 
produce unwelcome confusion. Individual brokers are entitled to 
consistency and predictability when meeting the continuing broker 
education requirement. When continuing broker education is completed, 
the individual broker will know exactly how many continuing education 
credits he or she earned. Allowing for trainings or educational 
activities to be accredited after the event has occurred does not serve 
that purpose and will create confusion. For example, if an individual 
broker participates in a non-accredited training, believing it will 
provide 1.5 credits just before the triennial status report is due, but 
an accreditor approves the activity for 1 credit, then the licensed 
customs broker has not completed the continuing broker education 
requirement, through no fault of his or her own. However, the licensed 
customs broker and CBP will be required to expend valuable time and 
resources determining the correct number of continuing education 
credits completed. Furthermore, CBP does not want to create a system 
that allows for undue pressure to be placed on CBP-selected accreditors 
to accredit trainings or educational activities because individual 
brokers believed they would receive credit or a specific amount of 
credit for attending or participating. As such, CBP will not allow 
continuing education credit to extend to participation in a continuing 
broker education program before the training or educational activity 
was accredited.
    Comment: Many commenters requested that providers of trainings and 
educational activities should be permitted to request approval from an 
additional accreditor if initially denied accreditation. The commenters 
were concerned that an accreditor could deny an applicant's courses for 
accreditation for competitive reasons or due to lack of familiarity 
with a subject matter. One commenter asked that the applicant be 
advised in writing of the reason(s) for denial of accreditation and 
provided with a reasonable opportunity to amend the denied application 
for accreditation.
    Response: CBP agrees and always intended to allow applicants of 
denied trainings and educational activities to either reapply for 
accreditation or amend an original application. Further, accreditors 
will provide the applicant seeking approval the reason(s) for the 
denial of an accreditation of a course. Greater flexibility in the 
accreditation process will produce better continuing broker education 
options for individual brokers. CBP believes the accreditation process 
will be dynamic and wants to ensure parties may re-submit trainings and 
educational activities for vetting following a denial. As such, CBP has 
made an amendment to the proposed regulations to guarantee clarity on 
this topic. Specifically, CBP has edited proposed Sec.  111.103(d) to 
explicitly prohibit CBP-selected accreditors from denying review or 
approval of a training or educational activity for continuing education 
credit solely because it was previously denied by the CBP-selected 
accreditor or any other CBP-selected accreditor. CBP will address 
specific processes and timeframes in the RFPs, however, CBP will not be 
making definitive guidelines concerning accreditation standards at this 
time. After selecting qualified accreditors, standard guidelines for 
accreditation will be developed. CBP will provide additional 
information in the future.
    Comment: Two commenters requested that CBP allow a single 
accreditation to apply to all programs/classes in a course or to allow 
blanket accreditation.
    Response: CBP disagrees with these comments as CBP cannot commit to 
specific accreditation procedures at this time. CBP believes the 
accreditation process will be flexible to allow greater quantity and 
quality of continuing broker education opportunities. However, the 
exact way potential continuing broker education is evaluated, whether 
courses may be grouped or individually examined, how continuing 
education credits will be assigned in a symposium or convention, etc., 
will be determined after CBP has selected qualified accreditors and 
leveraged their expertise. CBP will provide additional information in 
the future.
    Comment: Many commenters requested that CBP should enable CBP-
selected accreditors to self-certify the party's own training and 
educational activities.
    Response: CBP disagrees because self-certification of an 
accreditor's own trainings and educational activities is not viable. 
CBP is not prohibiting CBP-selected accreditors from also producing 
qualified continuing broker education. However, to limit the risk of 
conflicts of interest and self-dealing, CBP must prohibit accreditors 
from accrediting their own training and educational activities. CBP 
would be doing a disservice to individual brokers if it selected 
accreditors that devoted their time to accrediting their own trainings 
and educational activities instead of vetting the trainings and 
educational activities of other content providers. Individual brokers 
deserve to have diverse continuing broker education. If a CBP-selected 
accreditor's trainings and educational activities meet the standards 
for accreditation, then a separate accreditor is just as capable of 
reaching the same conclusion and accrediting. The guidelines and 
standards for accrediting trainings and educational activities will be

[[Page 41237]]

determined after CBP has selected qualified accreditors and leveraged 
their expertise. These standards will be followed by every CBP-selected 
accreditor, as monitored by CBP. CBP will provide additional 
information in the future.
    Comment: One commenter specifically requested that brokerage firms, 
regardless of their form, and broker associations should be able to 
self-certify trainings or educational activities that they deliver in-
house or to their members.
    Response: CBP disagrees with this comment as CBP will not allow 
self-certification of trainings or educational activities, in any form, 
to limit the risk of conflicts of interest and self-dealings. 
Furthermore, a training or education activity will only provide 
continuing education credit to an individual broker if it is accredited 
by a CBP-selected accreditor or offered by CBP or another U.S. 
government agency. The guidelines and standards for accrediting 
trainings and educational activities can best be determined after CBP 
has selected qualified accreditors and leveraged their expertise. CBP 
will provide additional information in the future.
    Comment: One commenter requested that the term of valid 
accreditation for a training or educational activity be extended from 
one year to two years under proposed Sec.  111.103(d). Another 
commenter requested that the term of valid accreditation for a training 
or educational activity be extended to no longer than three years.
    Response: CBP disagrees with the commenters because CBP intends for 
all qualified continuing broker education to stay current. One of the 
major goals of the continuing broker education requirement is to ensure 
individual brokers have the latest information to access and meet their 
continuing education credit requirements. To that end, outdated 
trainings or educational activities cannot be allowed to go unchanged 
for years at a time with the potential to circulate outdated 
information. CBP believes that requiring all accredited continuing 
broker education to be reaccredited every year as specified in Sec.  
111.103(d), is a small cost compared to the net benefit of ensuring 
that the trainings and educational activities are reexamined for 
inconsistencies or updated with new information. If details on a 
specific topic have not changed, then the training or educational 
activity will likely receive reapproval.

I. Enforcement

    In the NPRM, CBP proposed specific consequences for an individual 
broker who fails to certify completion of his or her continuing broker 
education. CBP also outlined immediate steps that may be taken by the 
individual broker to return his or her license to good standing. CBP 
received several comments regarding enforcement of the requirements. 
For a more detailed discussion of record requests see Subsection E.
    Comment: One commenter requested that CBP change the language in 
the NPRM of ``false, misleading, or omitting material fact'' to include 
the qualifier ``knowingly.''
    Response: CBP disagrees because the regulations finalized in this 
document only address enforcement actions against individual brokers 
who fail to certify completion of the continuing education requirement 
when submitting their triennial status reports. This document does not 
change in any way 19 CFR 111.53(a), which authorizes CBP to initiate 
proceedings for the suspension, for a specific period of time, or 
revocation of the license or permit of a customs broker, if the broker 
has, among other things, made in any report filed with CBP any 
statement which was, at the time and in light of the circumstances 
under which it was made, false or misleading with respect to any 
material fact, or has omitted to state in any report any material fact 
which was required. However, CBP notes that individual brokers may face 
suspension or revocation of their licenses if they violate 19 CFR 
111.53(a) when certifying completion of the continuing broker education 
requirement or when submitting records to CBP under Sec.  111.102(d).
    Comment: Many commenters requested that CBP provide an automated 
warning or notification message to individual brokers who fail to 
include their continuing education credits with their status reports to 
ensure awareness and that appropriate action is taken. One commenter 
stated that there should be a way, preferably online, for a broker to 
verify, and if need be, update the broker's contact information to 
ensure that CBP has the correct information on file.
    Response: CBP disagrees that it should provide for an automated 
warning or notification message. All individual brokers should be aware 
of the continuing education requirement and the requirement to certify 
completion of the requirement with the filing of the 2027 triennial 
status report or in any future reporting year. Individual brokers 
should note that they will only be required to certify completion of 
the requirement and will not be required to input or attach evidence of 
the 36 continuing education credits completed with their triennial 
status reports. Individual brokers will only need to produce their 
continuing broker education records if CBP requests them under Sec.  
111.102(d)(2). Further, CBP cannot say for certain that the eCBP Portal 
will have the capability to notify an individual broker of a ``missing 
field'' when an individual broker is filing the triennial status 
report. However, individual brokers may verify and/or update their 
contact information in the ACE Portal to ensure that CBP is sending the 
notification to the correct address.\11\ CBP will send notifications to 
an individual broker's email address, if an email address is on file, 
otherwise to an individual broker's physical address.
---------------------------------------------------------------------------

    \11\ The ACE Portal is a web-based entry point for ACE to 
connect CBP, trade representatives and government agencies who are 
involved in importing goods into the United States. The eCBP Portal 
is currently the access point for a new system for electronic 
payments of licensed customs broker fees. When fully implemented, 
the eCBP portal will allow for easy collection of many types of 
duties, taxes, and fees.
---------------------------------------------------------------------------

    Comment: Many commenters requested that CBP provide individual 
brokers 60 days to respond to a notification of failure to certify 
compliance with the continuing education requirements before 
suspension, instead of 30 days as specified in proposed Sec.  111.104. 
Additionally, one commenter requested that the suspension period of 120 
days before license revocation in proposed Sec.  111.104(d) be extended 
to one year to allow sufficient time for a first-time offender to 
correct any deficiency and that repeat offenders should be restricted 
to a period of less than six months to correct deficiencies.
    Response: CBP disagrees with the commenters requesting a longer 
timeframe to respond because 30 days is a standard window used when CBP 
is seeking a response or action from customs brokers. Furthermore, the 
30-day timeframe in Sec.  111.104 is only triggered in the specific and 
limited circumstance when an individual broker files an incomplete 
triennial status report by failing to certify compliance with the 
continuing broker education requirement. Certifying completion of 
continuing broker education is an essential requirement and necessary 
to maintain an active license in good standing. Failure to complete or 
certify completion of the continuing broker education requirement will 
have an immediate effect on individual brokers. More importantly, a 
license suspension under Sec.  111.104(c) can be avoided with taking 
corrective action on or before 30 calendar days from the date of 
issuance

[[Page 41238]]

of the notification of the potential suspension. If the license is 
suspended, an individual broker under Sec.  111.104(d) can still take 
corrective action on or before 120 calendar days from the date of 
issuance of the order of suspension. Corrective action can range from 
certifying completion of the requirement to completing 36 continuing 
education credits. CBP has determined that 120 calendar days is 
sufficient time in the most extreme situation for an individual broker 
to complete all 36 continuing education credits and return to good 
standing. Furthermore, CBP believes a universally applied timeframe 
avoids unnecessary and potentially harmful confusion around a 
substantial license status change. Individual brokers must be aware 
that CBP is serious about compliance with the continuing broker 
education requirement, but CBP also wants to ensure minor mistakes can 
be quickly corrected with limited effect on the license.

IV. Conclusion

    Based on the analysis of the comments and further consideration, 
CBP has decided to adopt as final the proposed rule published in the 
Federal Register (86 FR 50794) on September 10, 2021, as modified by 
the changes noted in Section II, Summary of Changes from the Proposed 
Regulations, above and in Section III, Discussion of Comments.

V. Statutory and Regulatory Requirements

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 rule is not a ``significant regulatory action,'' 
under section 3(f) of Executive Order 12866. Accordingly, OMB has not 
reviewed this regulation.
    CBP published the proposed rule titled, ``Continuing Education for 
Licensed Customs Brokers,'' on September 10, 2021, and received 70 
comments from the public.\12\ CBP adopts the regulatory amendments 
specified in the proposed rule with a few changes. After careful 
consideration of the public comments, CBP has made the following 
modifications: the recognition of half credits for 30 minutes of 
continuing broker education; the clarification that CBP will identify, 
in coordination with other U.S. government agencies when applicable, 
the qualified continuing broker education offered by a government 
agency that is relevant to customs business; the clarification that 
self-guided online modules qualify towards continuing education 
requirements; and the clarification that content providers may apply to 
multiple accreditors. With the adoption of the proposed regulatory 
amendments, CBP applies the 2021 NPRM's economic analysis approach to 
this final rule, updating the data as necessary. The modifications 
adopted in this final rule are discussed in greater detail in Sections 
II and III above, and do not affect the assumptions underlying the 
economic analysis.
---------------------------------------------------------------------------

    \12\ 86 FR 50794.
---------------------------------------------------------------------------

1. Purpose of Rule
    The final rule requires active individual customs broker license 
holders (``individual brokers'') to complete 36 hours of continuing 
education every three years, in line with the triennial status 
reporting period. A continuing broker education requirement will 
increase the knowledge base from which brokers work, educate them on 
changing customs requirements, regulations, and laws, and reduce the 
number of errors in filings and resultant penalties. CBP believes that 
requiring continuing broker education will enhance the credibility and 
value of an individual customs broker license and improve an individual 
broker's skills, performance, and productivity. Furthermore, CBP 
believes that mandating continuing broker education will increase the 
quality of service for individual brokers' clients and importers' 
compliance with customs laws, which will protect the revenue of the 
United States and aid in maintaining a high standard of professionalism 
in the customs broker community.
2. Background
    On October 28, 2020, CBP published an advance notice of proposed 
rulemaking (ANPRM), entitled ``Continuing Education for Licensed 
Customs Brokers,'' in the Federal Register (85 FR 68260). The ANPRM 
presented a basic outline for a continuing broker education requirement 
for individual brokers and posed questions pertaining to the potential 
costs and benefits of such a requirement. Some of the public comments 
that CBP received in response to the ANPRM addressed the questions 
pertaining to the potential costs and benefits of such a requirement, 
although very few responses contained specific information or data. Any 
information that was provided on these issues was taken into account in 
formulating the analysis in the Notice of Proposed Rulemaking (NPRM) of 
the same title, which CBP published in the Federal Register on 
September 10, 2021 (86 FR 50794). CBP did not receive comments about 
CBP's economic analysis of the proposed rule. CBP has adopted a few 
suggestions from the public comments, as outlined above. In this final 
rule, CBP describes the new requirement for continuing broker education 
for individual brokers.
i. Customs Brokers
    A customs broker assists clients with the importation of goods into 
the United States, and also with the filing of drawback claims. Customs 
brokers can be individuals, partnerships, associations, or corporations 
and must be licensed by CBP. Brokers are responsible for helping 
clients meet all relevant requirements for importing and submitting 
drawback claims, submitting information and payments to CBP on their 
client's behalf, and exercising responsible supervision and control 
over their employees and customs business.\13\ Only licensed customs 
brokers may perform customs business.\14\ Brokers may have expertise in 
any number of trade-related areas, including entry, admissibility, 
classification, valuation, and duty rates for imported goods. Some 
brokers specialize in a specific area of customs business, like 
drawback or valuation, while others are more general practitioners. As 
of 2022, there are

[[Page 41239]]

13,952 active individual brokers in the United States.\15\
---------------------------------------------------------------------------

    \13\ 19 U.S.C. 1641(b)(4). For more details on responsible 
supervision and control, see 19 CFR 111.1 and 111.28.
    \14\ Customs business is defined as: those activities involving 
transactions with U.S. Customs and Border Protection concerning the 
entry and admissibility of merchandise, its classification and 
valuation, the payment of duties, taxes, or other charges assessed 
or collected by U.S. Customs and Border Protection upon merchandise 
by reason of its importation, or the refund, rebate, or drawback 
thereof. It also includes the preparation of documents or forms in 
any format and the electronic transmission of documents, invoices, 
bills, or parts thereof, intended to be filed with U.S. Customs and 
Border Protection in furtherance of such activities, whether or not 
signed or filed by the preparer, or activities relating to such 
preparation, but does not include the mere electronic transmission 
of data received for transmission to CBP. See 19 U.S.C. 1641(a)(2).
    \15\ A customs broker may voluntarily suspend his or her license 
for a number of reasons and may re-activate the license at a later 
time. A broker's license may also be suspended as part of a penalty. 
For more information, see 19 CFR 111.52 and 111.53.
---------------------------------------------------------------------------

    To become a licensed customs broker, an eligible individual \16\ 
must pass the Customs Broker License Examination, submit a broker 
license application and appropriate fees to CBP, and be approved by 
CBP.\17\ Once applicants have passed the broker exam, they may apply 
for an individual, corporate, partnership, or association license. To 
maintain the license, the individual broker or the licensed entity (for 
corporations, partnership, or associations) must submit a triennial 
status report and requisite fees. The triennial status report and fees 
must be submitted by February 1, every three years, since 1985.\18\ 
Once an individual has been approved as a customs broker, the primary 
ongoing requirement for maintaining the license under current 
regulations is the submission of the triennial status report and 
appropriate fee in three-year periods. Given the established three-year 
cycle of triennial status reporting, CBP employs a seven-year period of 
analysis to calculate costs and benefits that result from this rule, 
accounting for one year of preparation by CBP and two triennial cycles.
---------------------------------------------------------------------------

    \16\ To be eligible, an individual must be a United States 
citizen at least 21 years of age, in possession of good moral 
character, and not be an employee of the U.S. government. For more 
information, see U.S. Customs and Border Protection, Becoming a 
Customs Broker (Dec. 12, 2018), available at https://www.cbp.gov/trade/programs-administration/customs-brokers/becoming-customs-broker.
    \17\ To be approved, a broker who has passed the broker exam 
must also pass an investigation of his or her relevant background. 
See 19 CFR 111.14.
    \18\ 19 CFR 111.30(d). For more information on the triennial 
status report, see U.S. Customs and Border Protection, 2021 Customs 
Broker Triennial Status Report FAQs (Feb. 26, 2021), available at 
https://help.cbp.gov/s/article/Article-1711?language=en_US.
---------------------------------------------------------------------------

    A broker license may be suspended or revoked, or a monetary penalty 
assessed, for several violations, ranging from falsifying information 
on the license application to willfully and knowingly deceiving, 
misleading, or threatening a client.\19\ CBP generally assesses 
monetary penalties for less serious infractions, such as the incorrect 
filing of entry forms or the misclassification of goods. However, the 
majority of civil monetary penalties assessed against brokers for 
violations of 19 U.S.C. 1641 involve egregious violations or the 
failure to take satisfactory corrective actions following written 
notice and a reasonable opportunity to remedy the deficiency, as the 
penalties process provides noncompliant brokers with several 
opportunities to avoid or mitigate penalty liability.\20\ Monetary 
penalties may not exceed $30,000 per violation. From 2017-2021, the 
average penalty assessed was $26,670 and the average collected amount 
was $2,423 due to mitigations allowed by CBP.\21\
---------------------------------------------------------------------------

    \19\ See,19 U.S.C. 1641(d)(1) and (g)(2) and 19 CFR 111.53.
    \20\ In the case of non-egregious violations, CBP will first 
attempt to work with the broker through the informed compliance 
process of communication and education. See U.S. Customs and Border 
Protection, Electronic Invoice Program (EIP) and Remote Location 
Filing (RLF) Handbook (May 2013), p. 22, available at https://www.cbp.gov/sites/default/files/assets/documents/2016-Dec/Revised_eip_rlf_handbook_12-15_16.pdf. This is an attempt to improve 
the broker's performance, and precedes the issuance of a pre-penalty 
notice, which is a written notice that advises the broker of the 
allegations or complaints against the broker. See id.; 19 CFR 
111.92(a). If this process fails to remedy the deficiencies, or in 
case of egregious violations, CBP will issue a pre-penalty notice to 
the broker, which, inter alia, explains that the broker has the 
right to respond to the allegations or complaints. See 19 CFR 
111.92(a). If the broker files a timely response to the pre-penalty 
notice, CBP will either cancel the case, issue a penalty notice in 
an amount lower than that provided in the pre-penalty notice, or 
issue a penalty notice in the same amount as the pre-penalty notice. 
See 19 CFR 111.92(b). Upon the issuance of the penalty notice, the 
broker is afforded the opportunity to file a petition for relief in 
accordance with the provisions of 19 CFR part 171, which may result 
in the cancellation or mitigation of the penalty, and subsequently a 
supplemental petition for relief. See 19 CFR 111.93 and 111.95.
    \21\ 19 U.S.C. 1641(d)(2)(B). Penalty information comes from 
CBP's Seized Currency and Asset Tracking System (SEACATS). Although 
the average value of assessed penalty is $26,670, CBP allows brokers 
to mitigate penalties, such that the amount collected is often 
significantly less, averaging $2,423 from 2017-2021.
---------------------------------------------------------------------------

    In the fiscal years from 2017 to 2021, CBP assessed an average of 
67 penalties to brokers per year.\22\ However, in FY 2017 and FY 2018, 
CBP assessed 20 and 21 penalties, respectively, while in FY 2019 and FY 
2020, CBP assessed over 100 penalties each year, with an additional 71 
penalties assessed in FY 2021 (see Table 1). The significant increase 
in penalties from 2018 to 2019 and into 2020, and the slight decline in 
2021 is likely due to rapid changes in the international trade 
environment in those years, and the experience gained with those 
changes. During that time, CBP began enforcing several significant 
changes in the realm of international trade, including new antidumping 
and countervailing duties (AD/CVD) and the tariffs imposed by the Trump 
Administration under section 201 of the Trade Act of 1974 (19 U.S.C. 
2251), as amended, section 232 of the Trade Expansion Act of 1962 (19 
U.S.C. 1862), as amended, and sections 301 through 310 of the Trade Act 
of 1974 (19 U.S.C. 2411 et seq.), as amended.\23\ These changes 
affected a significant number of imported goods. CBP provided many 
opportunities for individual brokers to learn about the changes, 
including webinars, Question and Answer sessions, public forums, and 
Federal Register notices. External organizations, like regional broker 
associations, also provided information regarding these changes to the 
customs laws, which would have led to greater understanding for 
individual brokers.
---------------------------------------------------------------------------

    \22\ SEACATS.
    \23\ Trade remedies implemented by CBP include Section 201 trade 
remedies on solar cells and panels and washing machines and parts; 
Section 232 trade remedies on aluminum and steel; Section 232 trade 
remedies on derivatives; and Section 301 trade remedies to be 
assessed on certain goods from China. See U.S. Customs and Border 
Protection, Trade Remedies, available at https://www.cbp.gov/trade/programs-administration/trade-remedies (last visited on March 16, 
2023).
---------------------------------------------------------------------------

    Although CBP sought information in the ANPRM on the number of 
companies employing individual brokers who already complete continuing 
education, CBP did not receive enough specific information to estimate 
the proportion of companies already providing ongoing training. 
Comments in response to the NPRM did not yield any more information, 
though commenters did not take issue with the assumptions made below. 
Based on information gathered via self-reporting by individual brokers, 
CBP is aware of about 300 companies that employ at least one individual 
broker who holds an industry certification that requires annual 
continuing education.\24\ In the fiscal years from 2017 to 2021, a 
group of about 120 of those companies were responsible for 54 percent 
of the entries but only nine percent of the penalties.\25\ Overall, 
these 120 companies filed 94,808,248 of the total 174,132,601 entries 
between 2017 and 2021, but only account for 29 of 337 total penalties 
assessed in that period.\26\ For companies outside of this group, CBP 
does not know how much continuing education is currently taken.
---------------------------------------------------------------------------

    \24\ Information was provided by the National Customs Broker and 
Forwarders Association of America (NCBFAA). Nine companies employ at 
least 48 brokers certified by programs provided by the NCBFAA's 
Education Institute (NEI), and often employ more. An additional 292 
companies employing at least one individual broker with an NEI 
certification were identified via a survey of NEI's students.
    \25\ Significant at the 99 percent confidence level.
    \26\ Entry data was pulled from ACE, and penalty data from 
SEACATS.

[[Page 41240]]



                Table 1--Annual Penalties Assessed by CBP
------------------------------------------------------------------------
                                                             Number of
                           FY                                penalties
------------------------------------------------------------------------
2017....................................................              20
2018....................................................              21
2019....................................................             119
2020....................................................             106
2021....................................................              71
------------------------------------------------------------------------

ii. Continuing Education
    Continuing education refers to the training and learning pursued by 
professionals outside of the formal education system, usually as part 
of career development. Many licensed professions have some sort of 
continuing education requirement for license-holders, including 
attorneys, accountants, medical professionals, and teachers.\27\ 
Continuing education is particularly important for professions 
characterized by continuously changing rules, standards, and norms. 
Customs and international trade is one such profession. Since 2000, the 
United States has added two new preferential trade programs and several 
new free trade agreements, the most recent being the USMCA, which 
replaced the NAFTA.\28\ Additionally, the logistical aspects of customs 
have changed significantly over time. For example, CBP introduced the 
single window, enabling most CBP forms to be submitted electronically 
through the Automated Commercial Environment (ACE), which was fully 
implemented in 2016, with added functionalities being deployed on an 
ongoing basis.
---------------------------------------------------------------------------

    \27\ The number of hours of continuing education required for 
many professions varies by state as the state is the licensing 
authority.
    \28\ In October 2000, the United States implemented the 
Caribbean Basin Trade Partnership Act, which will expire in 2030 
(https://www.cbp.gov/trade/priority-issues/trade-agreements/special-trade-legislation/caribbean-basin-initiative/cbtpa). The African 
Growth and Opportunity Act was also enacted in 2000 (https://ustr.gov/issue-areas/trade-development/preference-programs/african-growth-and-opportunity-act-agoa). See https://www.state.gov/trade-agreements/outcomes-of-current-u-s-trade-agreements/ for a list of 
free trade agreements currently in force.
---------------------------------------------------------------------------

    There have been several other significant changes to the customs 
environment, including the implementation of the Trade Facilitation and 
Trade Enforcement Act (TFTEA), changes in duty rates and tariffs, and 
the modernization of the drawback requirements. Individual brokers must 
maintain awareness of and adapt to these changes to provide quality 
service to clients. However, aside from the broker exam at the 
beginning of their careers, individual brokers do not currently have 
any requirements ensuring that they maintain up-to-date knowledge of 
customs rules, regulations, and practices. As stated above, CBP 
believes that the vigorous pace and expanding scope of international 
trade require a more stringent continuing education framework for 
individual brokers who provide guidance to importers and drawback 
claimants.
    The effects of continuing education programs are not easily 
measured and not often the subject of research.\29\ Some studies show 
that various licensed professions do see a mild increase in positive 
perception of their industry, performance, and professionalism after 
the implementation of continuing education requirements.\30\ Studies 
have also demonstrated a positive link between continuing education for 
teachers and student outcomes as well as between continuing medical 
education and patient outcomes.\31\ Additionally, one study found that 
continuing professional education was correlated to an improvement in 
financial outcomes for accounting firms, particularly large firms.\32\ 
Finally, a study of Internal Revenue Service-certified tax preparers 
found that mandatory continuing education was potentially linked to 
reduced civil penalties, a decrease in non-compliance, and increased 
accuracy of tax returns.\33\
---------------------------------------------------------------------------

    \29\ ``Evaluation of Current Customs Broker Continuing Education 
Practices and Literature Review of Continuing Education in Other 
Professions.'' Report for CBP prepared by IEC on June 30, 2014. This 
document is included in the docket for this final rule, which is 
posted on Regulations.gov.
    \30\ See Bradley, S., Drapeau, M. and DeStefano, J. (2012), The 
relationship between continuing education and perceived competence, 
professional support, and professional value among clinical 
psychologists. J. Contin. Educ. Health Prof., 32: 31-38; O'Leary, 
P.F., Quinlan, T.J., & Richards, R.L. (2011). Insurance 
Professionals' Perceptions of Continuing Education Requirements. 
Journal of Insurance Regulation, 30, 101-117; and Wessels, S. 
(2007). Accountants' Perceptions of the Effectiveness of Mandatory 
Continuing Professional Education. Accounting Education, 16(4), 365-
378.
    \31\ Darling-Hammond, L., Hyler, M.E., and Gardner, M. (2017). 
Effective Teacher Professional Development. Learning Policy 
Institute; Cervero, R. M., & Gaines, J.K. (2014). Effectiveness of 
continuing medical education: updated synthesis of systematic 
reviews. Accreditation Council for Continuing Medical Education.
    \32\ Chen, Y.-S., Chang, B.-G., & Lee, C.-C. (2008). The 
association between continuing professional education and financial 
performance of public accounting firms. International Journal of 
Human Resource Management, 19(9), 1720-1737.
    \33\ Diehl, K. A. (2015). Does Requiring Registration, Testing, 
and Continuing Professional Education for Paid Tax Preparers Improve 
the Compliance and Accuracy of Tax Returns?--US Results. Journal of 
Business & Accounting, 8(1), 138-147.
---------------------------------------------------------------------------

    Under the terms of this rule, individual brokers will be required 
to complete 36 hours of qualifying continuing broker education over 
each three-year reporting period. Qualifying activities will include 
attending or presenting at accredited events, such as courses, 
seminars, symposia, and conventions.\34\ Online activities, including 
qualified trainings provided in-house will also be education 
opportunities. Individual brokers will be required to self-attest to 
the completion of the required continuing broker education on each 
triennial status report and maintain records consisting of certain 
documentation received from the provider or host of the qualifying 
continuing broker education, if such documentation was made available 
to the individual broker, and containing information pertaining to the 
dates, titles, providers, credit hours earned, and location (if 
applicable) for each training. The records can be in any format (i.e., 
electronically or on paper), and the regulations provide CBP with 
authority to conduct a record request for a period of three years 
following the submission of the status report.
---------------------------------------------------------------------------

    \34\ See 19 CFR 111.103(a).
---------------------------------------------------------------------------

iii. Accreditation
    To ensure the quality and relevance of continuing education 
offerings, they are often accredited by a leading body within the field 
in question. For example, the American Medical Association (AMA) is 
accredited to provide training by the Accreditation Council for 
Continuing Medical Education.\35\ An accreditor is responsible for 
reviewing course content and determining the number of credits or hours 
to be granted for each course.
---------------------------------------------------------------------------

    \35\ See American Medical Association, About the AMA's CME 
Accreditation, available at https://edhub.ama-assn.org/pages/ama-cme 
(last accessed on May 11, 2021).
---------------------------------------------------------------------------

    Under the final rule, after an application process (using the RFP, 
as described above), CBP will designate entities outside of CBP to act 
as accreditors for qualifying continuing broker education. Currently, 
CBP anticipates releasing, every three years, an RFP soliciting 
applications to become an accreditor for the continuing broker 
education program. Every three years following the first cycle, 
existing accreditors will also apply for renewal. To apply, potential 
and existing accreditors may submit an application to CBP detailing 
their standards for accreditation, quality control practices, 
application process, and other information. A panel of CBP experts will 
convene to review and approve or deny applications. Once approved, 
accreditors can begin accepting submissions from program creators or 
companies seeking accreditation for

[[Page 41241]]

specific programs. However, training or educational activities offered 
by U.S. government agencies--so long as the content is relevant to 
customs business as identified by CBP in coordination with the offering 
agency--do not require accreditation.\36\
---------------------------------------------------------------------------

    \36\ Per section 111.103(a)(1)(i), a training or educational 
activity offered by a U.S. government agency other than CBP must be 
relevant to customs business.
---------------------------------------------------------------------------

iv. Performance Improvement
    Once brokers have passed the broker exam, thereby proving their 
basic knowledge and competency to perform the duties of a licensed 
customs broker at the time of the exam, they are free to practice in 
perpetuity unless the license is suspended or revoked. The statute 
dictates that while practicing under the auspices of his or her broker 
license, a customs broker must maintain responsible supervision and 
control.\37\ CBP's regulations likewise place additional legal 
obligations upon customs brokers, including, but not limited to, the 
requirement for exercising due diligence in making financial 
settlements, answering correspondence, and preparing or assisting in 
the preparation and filing of information relating to customs 
business.\38\ Staying current on developments in customs law is needed 
for individual brokers to comply with their legal obligations, but 
presently there are no standards for how much continuing broker 
education is needed.
---------------------------------------------------------------------------

    \37\ See 19 U.S.C. 1641(b)(4).
    \38\ See 19 CFR 111.29(a), and 19 CFR part 111 generally for 
additional obligations.
---------------------------------------------------------------------------

    Under baseline conditions, meaning the world as it is prior to this 
rule, CBP does not require brokers to complete any additional training 
or prove their ongoing knowledge. The broker exam only tests knowledge 
of customs and related laws that are in place at the time of the exam. 
While the exam ensures that brokers have a solid base level of 
knowledge when they begin practicing, there is no requirement that they 
keep up the knowledge, and evidence suggests that as more time passes 
since brokers took their exam, the more errors they make. Individual 
brokers who were assessed penalties by CBP between 2017 and 2020 have 
held their individual broker license for, on average, 37 years. In 
contrast, the average individual broker license has been held for 24 
years. This suggests that as more time passes since the passing of the 
customs broker exam, more errors are made. Furthermore, the exam does 
not test for any of the requirements of the more than 40 PGAs involved 
in regulating imports. Depending on the individual brokers' needs, CBP 
believes that continuing broker education should also include courses 
relating to the PGAs' international trade requirements, although there 
is no minimum requirement for certain subject matters in this rule.
    Given the often fast-paced and evolving nature of the international 
trade environment, CBP believes that a continuing broker education 
requirement will help to ensure that individual brokers remain current 
with their understanding of international trade laws and continue to 
expand their knowledge of customs regulations and practices. A more 
competent and educated customs broker community will also prevent 
costly errors, potentially saving brokers' clients time and money, as 
well as relieving CBP from expending valuable audit and penalty 
assessment and collection resources.
3. Overview of Assessment
    The final rule will result in costs and benefits for individual 
brokers, accreditors, providers of continuing education, and CBP. Many 
of the costs for individual brokers come in the form of time spent 
researching, registering for, attending, and reporting trainings. 
Individual brokers will also experience some opportunity cost as they 
forgo time spent on other tasks in favor of fulfilling a continuing 
broker education requirement. Accreditors must apply to CBP. Though CBP 
will not charge a fee, the accreditors will need to spend time in 
creating their applications. Similarly, providers of continuing broker 
education must apply to accreditors to have their coursework certified. 
Finally, CBP must designate accreditors, and, following the full 
implementation of the rule's framework, CBP may request records from 
individual brokers to confirm compliance.
    The benefits from the final rule will be largely qualitative. A 
continuing broker education requirement will help to professionalize 
and improve the reputation of the customs broker community, as well as 
to improve customer service and outcomes. Quantitatively, continuing 
education will likely lead to a reduction in errors in documentation 
and associated penalties assessed by CBP for some infractions and 
violations. Not only will individual brokers not need to pay the 
associated penalties, but CBP will save the time of identifying, 
assessing, and collecting such penalties. Similarly, CBP will likely 
see a reduction in regulatory audits of individual brokers.
4. Historical and Projected Populations Affected by the Rule
    The final rule applies to any individual holding an active customs 
broker license.\39\ Individual brokers who have voluntarily suspended 
their licenses are not required to complete continuing broker education 
until they elect to reactivate their licenses, at which point the 
requirements are pro-rated depending upon the timing within the 
triennial reporting period. Individual brokers who have not held their 
license for an entire triennial period at the time their first 
triennial status report is due are also exempted from completing 
training and reporting in their first triennial status report, though 
are bound by the terms of the rule in the following years. As of 2022, 
there are 13,952 active, individual broker licenses. All of those 
brokers, as well as any brokers who receive their licenses in 2023 will 
be required to begin complying with the terms of the rule with the 
2024-2027 reporting period, with the first certification of compliance 
due at the time of filing the 2027 triennial status report.\40\ Those 
brokers receiving their licenses in 2024, 2025, and 2026 will begin 
complying with continuing broker education requirements after 
completing their first triennial status reports in 2027 and will 
perform their first certifications in 2030.\41\
---------------------------------------------------------------------------

    \39\ Entities holding corporate, association, or partnership 
licenses must employ at least one individual broker, who will be 
required to comply with the rule. See 19 CFR 111.11(a) and (b).
    \40\ Triennial status reports are due in February of the 
reporting year and cover the previous three years. For these 
brokers, compliance is expected to begin in 2024, with the 2027 
triennial status report certifying completion of 36 hours of 
continuing broker education in 2024, 2025, and or 2026. As discussed 
above in Section I, D. Initial Certification Date, CBP has the 
ability to prorate the initial requirements if the rule is 
implemented part way through the triennial cycle. If needed, CBP 
will reduce the number of required continuing education credits for 
the triennial period beginning on February 1, 2024, as deemed 
necessary based on a revised implementation date. For the purposes 
of this analysis, CBP assumes a requirement of 36 hours of 
continuing education to be certified in 2027. To the extent that CBP 
must delay full implementation and prorate the number of required 
credits, actual costs for brokers in the triennial cycle from 2024-
2027 will be proportionally lower.
    \41\ Although brokers may complete their required broker 
continuing education at any point in the three years of the 
triennial period, for ease of presentation, CBP assumes that brokers 
will complete 12 hours of training each year. Brokers receiving 
their licenses in 2024, 2025, and 2026 will certify to the 
completion of their requirements in 2030, covering training taken in 
2027, 2028, and 2029.
---------------------------------------------------------------------------

    CBP approves approximately 600 new licenses per year, although the 
number of licenses added annually has been decreasing since at least 
2016. See Table

[[Page 41242]]

2 for a summary of licensing history for the previous six years.
---------------------------------------------------------------------------

    \42\ CBP sometimes issues licenses that are later suspended or 
terminated (either voluntarily or as a penalty). This table includes 
all licenses issued in these years that remain active as of 2022, as 
only holders of an active license will need to abide by the terms of 
the rule.
    \43\ The number of licenses applied for and issued in 2020 was 
significantly lower than in previous years due to the effects of the 
COVID-19 pandemic and related closures and delays. CBP excluded this 
year from calculations of growth rates due to its anomalous nature. 
Data for 2021 indicates that broker license applications have mostly 
returned to their pre-2020 levels.

                                    Table 2--Licensing History From 2016-2021
----------------------------------------------------------------------------------------------------------------
                                                                  Total licenses     Corporate      Individual
                              Year                                     \42\          licenses        licenses
----------------------------------------------------------------------------------------------------------------
2016............................................................             653              21             632
2017............................................................             580              16             564
2018............................................................             558              27             531
2019............................................................             464              15             449
2020 \43\.......................................................             187               7             180
2021............................................................             496              31             465
                                                                 -----------------------------------------------
    Total.......................................................           3,708             133           3,575
----------------------------------------------------------------------------------------------------------------

    Based on the compound annual growth rate from 2017-2021, which 
shows a decline of 4 percent in the number of individual licenses 
issued, CBP estimates it will issue 447 new individual licenses in 
2022, the year preceding the period of analysis.\44\ CBP estimates it 
will issue 2,692 new individual licenses over a seven-year period of 
analysis from 2023-2029, and 2,261 new individual licenses from 2024-
2029, the part of the period of analysis during which brokers will need 
to fulfill the requirements of the rule (see Table 3). Not all those 
license holders will be required to complete continuing broker 
education during the seven-year period of analysis; those brokers 
receiving their licenses in 2027, 2028, and 2029 will not need to begin 
compliance until after their first triennial reporting period in 2030. 
All new individual license holders will need to comply with the terms 
of the rule once it is in effect and they have completed their first 
triennial status report. This includes the 13,952 individual brokers 
licensed and active as of January 2022 as well as the 447 individual 
brokers projected to receive their licenses in 2022 and the 430 
individual brokers projected to receive their licenses in 2023. 
Individual brokers who receive licenses in 2024-2026 will not need to 
comply with the rule until after their first triennial reporting 
period, beginning in 2027. CBP estimates that 1,196 individual brokers 
will receive licenses from 2024-2026, with 1,065 receiving them from 
2027-2029 and completing their first continuing education certification 
outside the period of analysis. In total, therefore, CBP estimates that 
16,026 individual brokers will be required to abide by the rule in the 
six years from 2024 to 2029.\45\ No brokers will be required to comply 
with the rule in 2023, though brokers licensed that year will need to 
comply in subsequent years.
---------------------------------------------------------------------------

    \44\ The rate of decline in licenses can vary based on the years 
chosen for calculations. In the NPRM, CBP estimated a decline of 12 
percent, but data from 2021 indicates that licensing recovered to 
and increased from levels seen before disruptions from the COVID-19 
pandemic, resulting in a reduction in the rate of decline in 
licenses issued. CBP believes that this recovery is likely to 
continue for a few more years as the industry adjusts.
    \45\ 14,828 individual brokers will certify compliance in the 
2027 triennial report (who will comply from 2024-2026) = 13,952 
(2022 active) + 447 (2022 new) + 430 (2023 new)). 16,026 individual 
brokers will certify compliance in the 2030 triennial report (who 
will comply from 2027-2029) = 14,828 (2024 active) + 414 (2024 new) 
+ 398 (2025 new) + 383 (2026 new).
    \46\ All active, licensed, individual customs brokers will begin 
complying with the rule in 2024, regardless of what year they 
received their license. The 1,343 licenses newly affected in 2024 
include those brokers who received their licenses in 2021, 2022, and 
2023 and will complete their first triennial status report in 2024.

                                Table 3--Projected Licenses Issued From 2023-2029
----------------------------------------------------------------------------------------------------------------
                                                       Total                                       New licenses
                      Year                           licenses        Corporate      Individual      affected by
                                                      issued         licenses        licenses        the rule
----------------------------------------------------------------------------------------------------------------
2023............................................             459              29             430               0
2024............................................             442              28             414      \46\ 1,343
2025............................................             425              27             398               0
2026............................................             409              26             383               0
2027............................................             393              25             369           1,196
2028............................................             379              24             355               0
2029............................................             364              23             341               0
                                                 ---------------------------------------------------------------
    Total.......................................           2,871             179           2,692           2,539
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.


[[Page 41243]]

    Although the majority of active individual brokers will be required 
to complete continuing education under the rule, feedback from the 
broker community indicates that many brokers already complete the 
amount of continuing education that will satisfy this requirement.\47\ 
Many companies that employ individual brokers provide and require in-
house training and continuing education. Both independent brokers and 
brokers employed by brokerages often attend government-sponsored 
webinars, as well as trade conferences and symposia, which will qualify 
as continuing broker education under the terms of the rule. Many 
individual brokers also pursue professional certifications like the 
National Customs Brokers and Freight Forwarders Association of 
America's (NCBFAA) Certified Customs Specialist (CCS) and Certified 
Export Specialist (CES).\48\ Under the baseline, or the world as it is 
now, these individual brokers likely will be in compliance with the 
final rule and, assuming similar activities when a continuing education 
requirement is imposed, will not incur new costs under the new 
requirements, except for new reporting costs.
---------------------------------------------------------------------------

    \47\ Feedback was provided in the form of public comments on the 
ANPRM and was not disputed in public comments on the NPRM. 
Additional feedback was provided in various meetings and discussions 
between CBP personnel and customs brokers, as well as at trade 
conferences and meetings of the Task Force for Continuing Education 
for Licensed Customs Brokers, a part of the Commercial Customs 
Operations Advisory Committee (COAC). COAC is jointly appointed by 
the Secretary of the Treasury and the Secretary of DHS and advises 
the Secretary of the Treasury and the Secretary of Homeland Security 
on all matters involving the commercial operations of CBP. Meetings 
of COAC are presided over jointly by the Deputy Assistant Secretary 
for Tax, Trade, and Tariff Policy of the Department of Treasury and 
Commissioner of CBP, as described in section 109 of TFTEA. See III. 
Discussion of Comments, above.
    \48\ We included both individual brokers qualifying as CCS and 
CES in our analysis as the coursework for both has significant 
overlap and is relevant to customs business.
---------------------------------------------------------------------------

    Overall, CBP estimates that approximately 60 percent of individual 
brokers already pursue continuing education and will be in compliance 
with the rule.\49\ CBP bases this estimation on several factors. First, 
the NCBFAA estimates that approximately 4,456 individual brokers hold a 
CCS or CES certification in 2020, representing 32 percent of total 
individual brokers.\50\ In order to maintain these professional 
certifications, these individual brokers are required to earn 20 
continuing education credits per year.\51\ Additionally, public 
comments in response to the ANPRM, as well as discussions between CBP 
and various broker organizations, indicate that most large businesses 
employing individual brokers already provide, and often mandate, 
internal training and continuing education. Based on data from the U.S. 
Census Bureau, approximately 61 percent of those employed within the 
Freight Transportation Arrangement Industry (NAICS code 448510) are not 
employed by small businesses. A small business within the Freight 
Transportation Arrangement Industry is defined as one whose annual 
receipts are less than $20.0 million in 2022 dollars ($17,274,816 in 
2017 dollars, using the CPI to account for inflation), regardless of 
the number of employees.\52\ Table 4 shows the receipts per firm, in 
millions of dollars (2017), for firms employing each number of 
employees.\53\ The average firm within Categories 7 and 9 has annual 
receipts of greater than $17.5 million in 2017 dollars and is 
considered a large business. These firms employ 161,463 people, or 
approximately 61 percent of the total employees in the industry.
---------------------------------------------------------------------------

    \49\ CBP requested information about the proportion of 
individual brokers already complying with the rule in the ANPRM. 
Although CBP did not receive specific information in the public 
comments, several commenters said they will be compliant and 
believed that significant numbers of other individual brokers will 
be as well. Many also noted that their companies require their 
broker employees to complete continuing education. Public comments 
in response to the NPRM did not dispute this assumption.
    \50\ Discussion with officials at the NCBFAA on April 5, 2021. 
This includes individual brokers renewing their certification in 
2020, as well as those becoming certified for the first time. The 
CCS certification program requires enough hours of continuing 
education to comply with the terms of the rule and the NCBFAA has 
expressed interest in becoming an accredited provider.
    \51\ See National Customs Brokers & Forwarders Association of 
America, Inc., Continuing Education available at https://www.ncbfaa.org/education/continuing-education. Accessed March 16, 
2023.
    \52\ Small business size standards are defined in 13 CFR part 
121. To calculate the effects of inflation from January 2017 to 
January 2022, see https://www.bls.gov/data/inflation_calculator.htm.
    \53\ United States Census Bureau, ``2017 County Business 
Patterns and 2017 Economic Census,'' Released March 6, 2020, https://www.census.gov/data/tables/2017/econ/susb/2017-susb-annual.html. 
Accessed March 15, 2021.
    \54\ Note that some of the categories are sums of other 
categories. For example, Category 8, <500, is a sum of Categories 2, 
3, 4, 6, and 7. Thus, Categories 7 and 9 are not consecutive, but 
represent all firms employing 100 or more people.
    \55\ The Survey of U.S. Businesses (SUSB) from which this data 
is taken is conducted in years ending in 2 and 7.

               Table 4--Small Businesses in the Freight Transportation Arrangement Industry, 2017
----------------------------------------------------------------------------------------------------------------
                                                        Preliminary
                                         Number of     receipts (all   Receipts per
        Employment size \54\             employees        firms,         firm ($)           Small business?
                                                       $1,000s) \55\
----------------------------------------------------------------------------------------------------------------
01: Total...........................         265,192     $67,276,572      $4,454,222  ..........................
02: <5..............................          15,939       6,315,166         708,614  Yes.
03: 5-9.............................          18,025       5,392,992       1,974,732  Yes.
04: 10-19...........................          20,288       5,870,163       3,851,813  Yes.
05: <20.............................          54,252      17,578,321       1,335,029  Yes.
06: 20-99...........................          49,477      13,973,780      10,397,158  Yes.
07: 100-499.........................          44,715      10,886,028      30,493,076  No.
08: <500............................         148,444      42,438,129       2,854,327  Yes.
09: 500+............................         116,748      24,838,443     105,247,640  No.
----------------------------------------------------------------------------------------------------------------

    Given the proportion of individual brokers working for larger 
businesses, the feedback on the ANPRM indicating high rates of 
compliance, the proportion of individual brokers pursing 
certifications, and input from CBP subject matter experts who 
frequently interact with the broker community, CBP estimates that 
approximately 60 percent of individual brokers are already in 
compliance with the requirements of the rule and will not face new 
costs, assuming a continuing level of similar activity, aside from 
recordkeeping and reporting, as a result of the rule's implementation. 
CBP did not receive any comments on this assumption in response to the 
NPRM.

[[Page 41244]]

Based on the likely proportion of individual brokers already in 
compliance, CBP estimates that 6,410 affected individual brokers, or 
approximately 40 percent, will need to come into compliance with the 
rule over a seven-year period of analysis (see Table 5). Although we 
requested comment on our assumption that 60 percent of brokers already 
spend at least 36 hours per three-year period on continuing education 
and that the remaining 40 percent of brokers will need to increase 
their training by the full 36 hours triennially to meet the 
requirement, the public comments received in response to the NPRM did 
not address this question. We therefore maintain the same assumption 
for the final rule.

                            Table 5--Projection of Brokers Affected by the Final Rule
----------------------------------------------------------------------------------------------------------------
                                                                                                  Total licensed
                              Year                                Total licenses   Proportion in      brokers
                                                                                  compliance (%)     affected
----------------------------------------------------------------------------------------------------------------
2023............................................................          13,952              60               0
2024............................................................          14,830              60           5,932
2025............................................................          14,830              60           5,932
2026............................................................          14,830              60           5,932
2027............................................................          16,026              60           6,410
2028............................................................          16,026              60           6,410
2029............................................................          16,026              60           6,410
                                                                 -----------------------------------------------
    Total.......................................................          16,026  ..............           6,410
----------------------------------------------------------------------------------------------------------------

    Although individual brokers are the primary party affected by the 
terms of the rule, the rule will also have an impact on CBP, providers 
of continuing broker education, and the bodies who accredit continuing 
broker education. Each party will see both costs and benefits under the 
final rule.
5. Costs of the Rule
i. To Brokers
    The primary cost to individual brokers upon implementation of the 
rule will be those costs associated with finding and attending 36 hours 
of continuing broker education over a three-year period. These costs 
include time spent researching reputable and relevant trainings, travel 
and incidental expenses to attend in-person events like conferences, 
and the tuition or fees for the courses themselves. Many individual 
brokers might satisfy the continuing broker education requirement with 
training supplied by their employers. Other individual brokers, 
particularly those self-employed or employed by small businesses, will 
need to seek external training. For external training, individual 
brokers may attend free webinars, seminars, and trade events sponsored 
by CBP, other government agencies, and various related organizations 
like local freight forwarder and broker associations.\56\ 
Alternatively, individual brokers might choose paid trainings, 
conferences, or symposia, or seek certifications offered by trade 
organizations or educational institutions. Based on comments received 
in response to the NPRM, CBP is also clarifying that self-guided, 
online courses or content, whether free or paid, which culminate in a 
retention test are also acceptable if accredited.
---------------------------------------------------------------------------

    \56\ For example, the Florida Customs Broker and Forwarders 
Association offers both paid and free events. Information on CBP-
hosted webinars can be found at https://www.cbp.gov/trade/stakeholder-engagement/webinars. Many other government agencies also 
provide webinars on trade-related topics. For example, in 2020, the 
Food and Drug Administration (FDA) hosted a series of webinars on 
the importation of medical devices in light of the COVID-19 
pandemic. See https://www.fda.gov/medical-devices/workshops-conferences-medical-devices/webinar-series-respirators-and-other-personal-protective-equipment-ppe-health-care-personnel-use.
---------------------------------------------------------------------------

    CBP does not know exactly which option each individual broker is 
likely to choose. Many individual brokers already hold certifications, 
attend webinars, and fulfill internal training requirements, though 
they may need to increase the number of hours completed to comply with 
the final rule. Therefore, CBP has estimated a range of costs. Some 
individual brokers will fulfill their continuing broker education 
requirements with only free trainings. Others will follow a medium-cost 
path by opting for a mix of free, lower-cost, and internal trainings. 
CBP further assumes that individual brokers electing the medium-cost 
path will travel to attend one major conference or symposium in-person 
per year. Finally, some will meet requirements by completing only paid 
courses representing the highest-cost offerings. CBP assumes that 
individual brokers choosing the higher-cost option will travel to 
attend an average of two conferences per year.
    There are several organizations that provide continuing education 
for customs brokers, ranging from regional broker associations to 
national entities, such as the American Association of Exporters and 
Importers (AAEI). Continuing broker education that qualifies under the 
terms of the rule includes webinars, seminars, and trade conferences. 
The hourly cost of such trainings (excluding free events provided by 
government agencies and other organizations) usually ranges from around 
$25 to $70. Fees are often tiered based on membership of the hosting 
organization. Members of an organization may pay $25 while non-members 
pay $45. CBP cannot predict which organizations will seek accreditation 
for their events, although free webinars and trainings hosted by 
Federal government agencies and identified by CBP will qualify and do 
not require approval by a CBP-selected accreditor. Therefore, we assume 
that the average hourly monetary cost will range from $0.00 (low) to 
$30 (medium) to $50 (high). This assumption is based on current fees 
charged for various continuing education certifications, webinars, and 
trade conferences, and CBP did not receive any comments on these 
assumptions in response to the NPRM.\57\
---------------------------------------------------------------------------

    \57\ CBP does not have information on the cost for an employer 
to provide training internally, although such information was 
requested in the ANPRM. CBP believes the cost for internal training 
will be closer to that of attending external trainings as a member, 
since member fees are likely much closer to base cost of provision 
than non-member fees.
---------------------------------------------------------------------------

    In addition to fees, individual brokers will need to spend some 
time in researching relevant and accredited trainings. CBP assumes that 
an individual broker will spend approximately three hours finding and 
registering for continuing broker education during every triennial 
period, an assumption that was not commented

[[Page 41245]]

upon in response to the NPRM. Many individual brokers are members of 
both local and national organizations that provide continuing education 
opportunities and will likely be notified of opportunities via 
newsletters or listservs. Other individual brokers will need to spend 
some time finding and verifying accreditation for qualifying events. 
All individual brokers will spend some time registering for events. 
Based on an average loaded wage rate of $34.81, the process of 
researching and registering for trainings will cost brokers 
approximately $2.90 per credit hour.\58\
---------------------------------------------------------------------------

    \58\ The median wage rate for brokers is best represented by 
BLS's Occupational Employment and Wage Statistics estimate for the 
median hourly wage rate for Cargo and Freight Agents (Occupation 
Code #43-5011), which was $22.55 in 2021. To account for non-salary 
employee benefits, CBP multiplied the median hourly wage by the 2021 
ratio of BLS's Employer Cost for Employee Compensation quarterly 
estimate of total compensation to wages and salaries for Office and 
Administrative Support occupations, the assumed occupational group 
for brokers. To adjust to 2022 dollars, CBP also assumes an annual 
growth rate of 4.15% based on the prior year's change in the 
implicit price deflator, published by the Bureau of Economic 
Analysis. Sources: U.S. Bureau of Labor Statistics. Occupational 
Employment Statistics, ``May 2021 National Occupational Employment 
and Wage Estimates United States.'' Updated March 31, 2022. 
Available at https://www.bls.gov/oes/2021/may/oes_nat.htm, Accessed 
May 25, 2022. The total compensation to wages and salaries ratio is 
equal to the calculated average of the 2021 quarterly estimates 
(shown under Mar, Jun, Sep, Dec) of the total compensation cost per 
hour worked for Office and Administrative Support occupations 
($29.6125) divided by the calculated average of the 2021 quarterly 
estimates (shown under March, June, Sept., Dec.) of wages and 
salaries cost per hour worked for the same occupation category 
($19.9825). Source of total compensation to wages and salaries ratio 
data: U.S. Bureau of Labor Statistics. Employer Costs for Employee 
Compensation. ``ECEC Civilian Workers--2004 to Present.'' March 
2022. Available at https://www.bls.gov/web/ecec.supp.toc.htm. 
Accessed May 25, 2022. Because median hourly wage information was 
not available for this respondent, CBP adjusted the annual median 
wage for this respondent to an hourly estimate using the standard 
2,080 hours worked per year.
---------------------------------------------------------------------------

    Many individual brokers also travel to attend trade conferences 
each year. CBP assumes that those individual brokers electing the 
lower-cost options will forgo travel and either attend virtually 
(paying only the fee) or not attend at all. CBP assumes that individual 
brokers in the medium-cost tier will travel to attend one conference 
each year, while individual brokers in the high-cost tier will travel 
to attend two conferences.\59\ Tuition and fees for conferences, broken 
down into an hourly rate, are already accounted for in the average 
costs of $30-$50 per hour. Traveling to attend a single 3-day 
conference costs approximately $332 in airfare, $288 for lodging, and 
$177 for meals and incidentals, for a total of $797 for one conference 
or $1,593 for two conferences (see Table 6).\60\ Over the three years 
of the triennial cycle, attending a single conference per year costs 
$2,391 and attending two conferences per year costs $4,779. Spread 
across 36 hours of training, travel costs account for an additional $66 
per hour (medium) or $133 per hour (high).
---------------------------------------------------------------------------

    \59\ Some individual brokers will pay for their travel out of 
pocket, while other will have their travel expenses covered by their 
employers.
    \60\ CBP bases these costs off the average, annual price of a 
domestic flight in 2021, and the General Services Administration's 
per diem cost for lodging and meals and incidental expenses. For the 
flight costs, CBP used the inflation-adjusted national average for 
2021, annual. Source for flight costs: The Bureau of Transportation 
Statistics, ``Average Domestic Airline Itinerary Fares,'' https://www.transtats.bts.gov/AverageFare/. Accessed March 21, 2023 (select 
`Annual' and `2021' from the drop-down menu). To calculate the 
lodging costs, CBP used the General Services Administration's FY22 
standard lodging per diem rate for the Continental United States 
($96) and assumed an average stay of 3 nights (3 nights * $96 per 
night = $288). To calculate the cost of meals and incidentals, CBP 
used the GSA's meals and incidental expenses reimbursement rate ($59 
per day) and again assumed an average stay of 3 days ($59 per day * 
3 days = $177). Source for per diem costs: U.S. General Services 
Administration, ``FY22 Per Diem Highlights,'' https://www.gsa.gov/cdnstatic/FY_2022_Per_Diem_Rates_Highlights.docx. Accessed March 21, 
2023.

                         Table 6--Travel and Incidental Costs To Attend In-Person Events
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                      Cost                         General cost         Low           Medium           High
----------------------------------------------------------------------------------------------------------------
Transportation..................................            $332              $0            $332            $664
Hotel...........................................             288               0             288             576
Meals & Incidentals.............................             177               0             177             354
                                                 ---------------------------------------------------------------
    Total (Per Year)............................             797               0             797           1,593
----------------------------------------------------------------------------------------------------------------

    To determine the total costs of the rule to a single broker, CBP 
calculated the costs of tuition for qualifying continuing education, 
travel to conferences, and research and registration on a per-credit 
hour basis. As described above, CBP assumes the per-credit hour cost of 
trainings to range from $0 (low) to $30 (medium) to $50 (high). The 
cost of research and registration is constant across tiers, as 
described above, and totals $2.90 per credit hour. The per-credit hour 
cost of travel is calculated by multiplying the per year cost of 
attending conferences described in Table 6 by 3 years and then dividing 
by 36 credit hours per triennial period. This results in costs of $0 
(low), $66 (medium), and $133 (high). The total, per-credit hour cost 
for a single broker therefore comes to $2.90 (low; $0 + $2.90 + $0), 
$99 (medium; $30 + $2.90 + $66), and $186 (high; $50 + $2.90 + $133).
    Overall, as a result of the rule, an individual broker will likely 
incur monetary costs ranging from $34.81 (low) to $1,191 (medium) to 
$2,228 (high) per year to complete 36 hours of continuing education in 
a three-year period. Over a seven-year period of analysis, these costs 
sum to $209 (low), $7,148 (medium), or $13,367 (high). See Table 7 for 
a summary of these costs.
---------------------------------------------------------------------------

    \61\ Individual brokers may complete whatever number of hours 
they prefer during each year, so long as it totals 36 hours in three 
years. CBP designates 12 hours per year both for ease of 
presentation and to account for pro-rating for individual brokers 
who re-activate their licenses within the triennial period.
    \62\ Costs include tuition/fees, travel costs, and research time 
costs for each level.

[[Page 41246]]



                                                          Table 7--Annual Costs for One Broker
                                                                   [2022 U.S. dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                       Low                     Medium                     High
                             Year                               Hours \61\ -----------------------------------------------------------------------------
                                                                             Costs \62\     Total        Costs        Total        Costs        Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
2023.........................................................            0        $0.00        $0.00           $0           $0           $0           $0
2024.........................................................           12         2.90        34.81           99        1,191          186        2,228
2025.........................................................           12         2.90        34.81           99        1,191          186        2,228
2026.........................................................           12         2.90        34.81           99        1,191          186        2,228
2027.........................................................           12         2.90        34.81           99        1,191          186        2,228
2028.........................................................           12         2.90        34.81           99        1,191          186        2,228
2029.........................................................           12         2.90        34.81           99        1,191          186        2,228
                                                              ------------------------------------------------------------------------------------------
    Total....................................................           72           17          209          596        7,148        1,114       13,367
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    There were 13,952 licensed individual brokers at the beginning of 
2022, with 447 and 430 additional brokers projected to receive their 
licenses in 2022 and 2023, respectively. Therefore, 14,830 brokers will 
be required to begin complying with the rule in 2024. Additionally, 
brokers newly licensed in 2024, 2025, or 2026 will be required to begin 
complying with the rule in 2027, for a total of 16,026 brokers 
reporting compliance in their 2030 triennial reports. CBP estimates 
that a total of 6,410 will be required to begin to complete continuing 
broker education under the terms of the rule in the seven-year period 
of analysis, based on a current estimated compliance rate of 60 percent 
(see Historical and Projected Populations Affected by the Rule, above). 
Therefore, CBP estimates that brokers will incur costs related to 
searching for training, fees, travel, and incidentals, totaling from 
$1,288,903 (low) to $44,111,892 (medium) to $82,491,664 (high) over the 
seven-year period of analysis. See Table 8.
---------------------------------------------------------------------------

    \63\ Only the 40 percent of individual brokers who do not 
already complete continuing education will face these costs. The 
total number of individual brokers affected in the final year of 
analysis (2029) is the same as the number of individual brokers 
overall because each year represents the same population with a 
small amount of growth.

                                       Table 8--Total Annual Training Costs for Individual Broker License Holders
                                                                   [2022 U.S. dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                       Low                     Medium                     High
                             Year                                Brokers   -----------------------------------------------------------------------------
                                                                   \63\         Cost        Total         Cost        Total         Cost        Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
2023.........................................................            0        $0.00           $0           $0           $0           $0           $0
2024.........................................................        5,932        34.81      206,491        1,191    7,067,013        2,228   13,215,702
2025.........................................................        5,932        34.81      206,491        1,191    7,067,013        2,228   13,215,702
2026.........................................................        5,932        34.81      206,491        1,191    7,067,013        2,228   13,215,702
2027.........................................................        6,410        34.81      223,144        1,191    7,636,952        2,228   14,281,519
2028.........................................................        6,410        34.81      223,144        1,191    7,636,952        2,228   14,281,519
2029.........................................................        6,410        34.81      223,144        1,191    7,636,952        2,228   14,281,519
                                                              ------------------------------------------------------------------------------------------
    Total....................................................        6,410          209    1,288,903        7,148   44,111,892       13,367   82,491,664
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    To create a primary estimate, CBP assumes that approximately one 
third of individual brokers will elect the lowest cost path ($34.81 
each year), one third will elect the medium-cost path ($1,191 each 
year), and one third will elect the highest cost path ($2,228 each 
year) once the rule is in place. CBP did not receive any comments on 
this assumption in response to the NPRM. Under these conditions, 
individual brokers who begin pursuing continuing education as a result 
of the rule will face $42,630,820 in costs related to searching for 
training, fees, travel, and incidentals over the seven-year period of 
analysis. See Table 9.

                        Table 9--Primary Estimate of Training & Travel Costs for Brokers
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                      Brokers
                              Year                                 Total brokers   choosing each    Total cost
                                                                                       path
----------------------------------------------------------------------------------------------------------------
2023............................................................               0               0              $0
2024............................................................           5,932           1,977       6,829,735
2025............................................................           5,932           1,977       6,829,735
2026............................................................           5,932           1,977       6,829,735
2027............................................................           6,410           2,137       7,380,538

[[Page 41247]]

 
2028............................................................           6,410           2,137       7,380,538
2029............................................................           6,410           2,137       7,380,538
                                                                 -----------------------------------------------
    Total.......................................................           6,410  ..............      42,630,820
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    All individual brokers, including those who already complete 
continuing education and will not face new costs for research, tuition, 
and travel, will also be required to store records of their completed 
continuing broker education and report their compliance to CBP.\64\ 
Record storage will require maintaining either paper or digital copies 
of any documentation received from the provider or host of the 
qualifying continuing broker education and a document of some kind 
listing the date, title, provider, number of credit hours, and location 
(if applicable) for each training. To report and certify compliance, 
individual brokers who file paper-based triennial status reports with 
CBP will include a written statement in the triennial status report, 
and individual brokers who file their triennial status reports 
electronically through the eCBP portal will check a box in the eCBP 
portal while filing their triennial status report electronically. 
Individual brokers will further be required to produce their records of 
compliance if requested by CBP, though CBP will only require individual 
brokers to maintain their records for the three years following the 
submission of the triennial status report.\65\ CBP estimates that 
recordkeeping and reporting will take each individual broker 30 minutes 
(0.5 hours) per year. After the first triennial reporting period in 
which individual brokers self-attest to completing their training, 10 
percent of individual brokers each year will incur the cost of 
producing records to submit to CBP following a record request, which 
CBP estimates will take 15 minutes (0.25 hours).\66\ Therefore, 
individual brokers will see $1,652,969 in new reporting and 
recordkeeping costs over the seven-year period of analysis. See Table 
10.
---------------------------------------------------------------------------

    \64\ Some individual brokers will likely face additional time-
costs should they fail to complete and/or report their required 
continuing broker education and need to take corrective action or 
reapply for their licenses following revocation (see section 
111.104(d) for details). However, CBP only reports the costs 
affected populations will face to maintain compliance with the rule.
    \65\ Note that many other records must be maintained for five 
years. The three-year standard applies only to records of continuing 
education.
    \66\ The exact percentage of record requests made will vary 
across each triennial reporting period. For the purposes of this 
analysis, we assume CBP will randomly select 10 percent of 
individual brokers to request records from each year.
    \67\ Note that only 10 percent of individual brokers will spend 
45 minutes per year, while the remaining 90 percent will spend 30 
minutes per year. Furthermore, CBP will only begin record requests 
after the first triennial period during which the rule is in effect.

                                    Table 10--Reporting Costs for All Brokers
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                    Time for
                                                  Time for          producing
            Year                  Brokers       recordkeeping    records (10% of    Loaded wage        Total
                                                (hours) \67\        brokers)
----------------------------------------------------------------------------------------------------------------
2023........................               0              0.00              0.00           34.81              $0
2024........................          14,830              0.50              0.00           34.81         258,113
2025........................          14,830              0.50              0.00           34.81         258,113
2026........................          14,830              0.50              0.00           34.81         258,113
2027........................          16,026              0.50              0.25           34.81         292,876
2028........................          16,026              0.50              0.25           34.81         292,876
2029........................          16,026              0.50              0.25           34.81         292,876
                             -----------------------------------------------------------------------------------
    Total...................          16,026                 3              0.75  ..............       1,652,969
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    To comply with the final rule, individual brokers who do not 
already do so will be required to spend 36 hours over three years 
completing continuing broker education in whatever form they choose. 
Additionally, CBP estimates they will spend three hours per three-year 
cycle researching and registering for trainings. Finally, individual 
brokers will need to spend about 30-45 minutes (0.5-0.75 hours) on 
recordkeeping per year. Overall, individual brokers will need to spend 
about 40.5 hours over a three-year period, or 81 hours over a seven-
year period of analysis, to comply with the rule.
    Some individual brokers will choose to complete their trainings 
outside of work hours, while others will complete training as part of 
their assigned duties. Individual brokers will also spend time in 
researching, registering for, and maintaining records of their 
continuing broker education, for a total of 12 hours per year of 
training plus 1.5 to 1.75 hours per year in research and recordkeeping. 
Based on the average loaded wage rate for brokers of $34.81, the 
opportunity cost of researching, registering for, attending, and 
reporting continuing broker education is approximately $17,432,417 over 
the seven-year period of analysis. See Table 11.

[[Page 41248]]



                                Table 11--Summary of Opportunity Cost for Brokers
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                    Loaded wage
                      Year                            Brokers          Hours           rate            Cost
----------------------------------------------------------------------------------------------------------------
2023............................................               0             0.0          $34.81              $0
2024............................................           5,932            13.5           34.81       2,792,787
2025............................................           5,932            13.5           34.81       2,792,787
2026............................................           5,932            13.5           34.81       2,792,787
2027............................................           6,410            13.5           34.81       3,018,019
2028............................................           6,410            13.5           34.81       3,018,019
2029............................................           6,410            13.5           34.81       3,018,019
                                                 ---------------------------------------------------------------
    Total.......................................           6,410              81          243.67      17,432,417
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    Total costs for all individual brokers, including tuition and 
travel expenses for those who must begin continuing broker education 
regimens because of the rule (see Tables 8 and 9) as well as 
opportunity costs (see Table 11) and reporting costs (see Table 10) for 
all individual brokers, range from $20,374,289 to $101,577,050. The 
primary estimate, which accounts for one third of individual brokers 
choosing each cost tier, comes to $61,716,206 over the seven-year 
period of analysis. See Table 12.

                                      Table 12--Total Costs for All Brokers
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                    Total cost:                     Total cost:
                      Year                          Total cost:       medium        Total cost:       primary
                                                   low estimate      estimate      high estimate     estimate
----------------------------------------------------------------------------------------------------------------
2023............................................              $0              $0              $0              $0
2024............................................       3,257,391      10,117,913      16,266,602       9,880,635
2025............................................       3,257,391      10,117,913      16,266,602       9,880,635
2026............................................       3,257,391      10,117,913      16,266,602       9,880,635
2027............................................       3,534,039      10,947,847      17,592,414      10,691,433
2028............................................       3,534,039      10,947,847      17,592,414      10,691,433
2029............................................       3,534,039      10,947,847      17,592,414      10,691,433
                                                 ---------------------------------------------------------------
    Total.......................................      20,374,289      63,197,278     101,577,050      61,716,206
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

ii. To CBP
    To implement the requirements of the rule, CBP will need to 
designate entities or companies as approved accreditors of continuing 
broker education. To do so, CBP will solicit applications from parties 
interested in becoming accreditors, or (following the first application 
cycle) accreditors seeking renewal of their status, by publishing an 
RFP.\68\ A panel of CBP experts will evaluate the applications and 
select the entities approved or renewed as accreditors. CBP estimates 
that the process of developing and submitting the RFP will take two 
personnel 10 hours each. Application evaluation will take a further 40 
hours per employee and will require four CBP personnel. The process of 
designating accreditors will occur before the continuing broker 
education requirements go into effect, to allow accreditors to be ready 
for the rule's implementation and ensure equal footing for all 
providers.\69\ Accreditors and CBP will need to complete the process 
three times in a seven-year period. Overall, designation of accreditors 
will require six CBP personnel 180 hours total, three times in a seven-
year period of analysis, for a cost to CBP of $59,260 (see Table 13).
---------------------------------------------------------------------------

    \68\ See 19 CFR 111.103(c).
    \69\ See Section I.E. of this final rule.
    \70\ CBP bases this rate on the FY 2022 salary, benefits, 
premium pay, non-salary costs, and awards of the national average of 
CBP Trade and Revenue positions, which is equal to a GS-12, Step 10. 
This represents the average, fully-loaded wage per hour, including 
salary, benefits, premium pay, and non-salary costs (assuming 2,080 
work hours/year). Source: Email correspondence with CBP's Office of 
Finance on June 27, 2022.

                                 Table 13--Costs to CBP To Designate Accreditors
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                   Personnel for   Personnel for   Fully-loaded
              Year                      RFP         evaluation    wage rate \70\    Total hours        Total
----------------------------------------------------------------------------------------------------------------
2023............................               2               4          109.74             180          19,753
2024............................               0               0          109.74               0               0
2025............................               0               0          109.74               0               0
2026............................               2               4          109.74             180          19,753
2027............................               0               0          109.74               0               0
2028............................               0               0          109.74               0               0

[[Page 41249]]

 
2029............................               2               4          109.74             180          19,753
                                 -------------------------------------------------------------------------------
    Total.......................  ..............  ..............  ..............  ..............          59,260
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    CBP's Broker Management Branch (BMB) will also face the costs of 
requesting records for compliance with the continuing broker education 
requirement. Although individual brokers will self-attest to their 
completion of the continuing broker education requirement with each 
triennial status report, CBP will occasionally conduct record requests 
by randomly selecting a certain subset of individual brokers to produce 
records. For the purposes of this analysis, CBP estimates it will 
select 10 percent of brokers per year, although the record requests 
will only cover the continuing broker education reported for the most 
recently completed triennial period. A continuing broker education 
record request will involve CBP personnel reviewing the reported 
coursework of the selected individual broker and potentially working 
with individual brokers to identify gaps or higher quality training 
opportunities. Such activity will take approximately one hour on 
average; therefore, CBP estimates that each record request will cost 
CBP approximately $109.74. For the first four years of the period of 
analysis, no record request will take place because individual brokers 
will not yet have reported their training at the end of the first 
triennial period. For the purposes of this analysis CBP assumes over 
the next three years, CBP will request records from 10 percent of 
active individual brokers each year.\71\ With about 1,603 record 
requests performed per year, costs to CBP will amount to $527,603 over 
the seven-year period of analysis. See Table 14.
---------------------------------------------------------------------------

    \71\ Those individual brokers who have not yet completed a 
triennial status report since taking their broker exam will be 
exempt from completing continuing broker education until after their 
first triennial status report and, therefore, will also be exempt 
from continuing broker education record requests during that time.

                                     Table 14--Record Request Costs for CBP
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                     Cost per
                              Year                                   Requests         request          Total
----------------------------------------------------------------------------------------------------------------
2023............................................................               0              $0              $0
2024............................................................               0               0               0
2025............................................................               0               0               0
2026............................................................               0               0               0
2027............................................................           1,603             110         175,868
2028............................................................           1,603             110         175,868
2029............................................................           1,603             110         175,868
                                                                 -----------------------------------------------
    Total.......................................................           4,809             329         527,603
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

iii. To Accreditors
    Accrediting bodies interested in becoming designated accreditors 
for continuing broker education under the terms of the rule will need 
to apply to CBP during an open RFP period and then re-apply to confirm 
their status every three years. Costs to respond to the RFP include 
only the preparation of the application. Overall, CBP estimates that 
the preparation of an application to CBP to become an accreditor will 
take two employees 40 hours each, to be completed three times in a 
seven-year period. Accreditor-applicants will need to apply three times 
in a seven-year period. Therefore, CBP estimates that CBP-selected 
accreditors will incur approximately $17,182 in costs over a seven-year 
period of analysis. See Table 15.

                                         Table 15--Costs to Accreditors
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                    Loaded wage      Hours per
                      Year                           Personnel       rate \72\       employee          Total
----------------------------------------------------------------------------------------------------------------
2023............................................               2          $71.59              40          $5,727
2024............................................               0           71.59               0               0
2025............................................               0           71.59               0               0
2026............................................               2           71.59              40           5,727
2027............................................               0           71.59               0               0
2028............................................               0           71.59               0               0
2029............................................               2           71.59              40           5,727
                                                 ---------------------------------------------------------------

[[Page 41250]]

 
    Total.......................................  ..............  ..............             120          17,182
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

iv. To Providers
---------------------------------------------------------------------------

    \72\ The median wage rate for accreditors is best represented by 
BLS's Occupational Employment and Wage Statistics estimate for the 
median hourly wage rate for General and Operations Managers 
(Occupation Code #11-1021), which was $47.10 in 2021. To account for 
non-salary employee benefits, CBP multiplied the median hourly wage 
by the 2021 ratio of BLS's Employer Cost for Employee Compensation 
quarterly estimate of total compensation to wages and salaries for 
Management, business, and financial occupations (1.4593), the 
assumed occupational group for accreditors. To adjust to 2022 
dollars, CBP also assumes an annual growth rate of 4.15% based on 
the prior year's change in the implicit price deflator, published by 
the Bureau of Economic Analysis. Sources: U.S. Bureau of Labor 
Statistics. Occupational Employment Statistics, ``May 2021 National 
Occupational Employment and Wage Estimates United States.'' Updated 
March 31, 2022. Available at https://www.bls.gov/oes/2021/may/oes_nat.htm, Accessed May 25, 2022. The total compensation to wages 
and salaries ratio is equal to the calculated average of the 2021 
quarterly estimates (shown under March, June, Sept., Dec.) of the 
total compensation cost per hour worked for Management, business, 
and financial occupations ($74.1275) divided by the calculated 
average of the 2021 quarterly estimates (shown under Mar, Jun, Sep, 
Dec) of wages and salaries cost per hour worked for the same 
occupation category ($50.7975). Source of total compensation to 
wages and salaries ratio data: U.S. Bureau of Labor Statistics. 
Employer Costs for Employee Compensation. ``ECEC Civilian Workers--
2004 to Present.'' March 2022. Available at https://www.bls.gov/web/ecec.supp.toc.htm. Accessed May 25, 2022.
---------------------------------------------------------------------------

    Providers of continuing broker education will also face new costs 
under the terms of the rule. Specifically, providers will need to 
submit applications to accreditors to have their coursework or events 
accredited. Officials at the NCBFAA Education Institute estimate that 
they currently approve approximately 1,000 courses per year. With the 
rule in place, CBP believes the number of events submitted for 
accreditation will increase substantially because companies' internal 
trainings and external offerings will need to be accredited. Therefore, 
CBP estimated that about 2,000 courses will require accreditation each 
year. Providers will likely pay a fee and will need to renew their 
accreditation annually to ensure their coursework remains up to date. 
The fee for accreditation is likely to vary based on accreditor, but 
CBP estimates it will average $25.\73\ Overall, CBP estimates that 
providers of continuing broker education for customs brokers will face 
$350,000 of new costs over a seven-year period of analysis. See Table 
16.
---------------------------------------------------------------------------

    \73\ This fee is based on that charged by the NCBFAA. Although 
CBP sought information in the ANPRM on how much accreditors might 
charge, CBP did not receive specific information. Comments to the 
NPRM yielded no new information.

                                          Table 16--Costs to Providers
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                              Year                                    Courses           Fee            Total
----------------------------------------------------------------------------------------------------------------
2023............................................................           2,000          $25.00         $50,000
2024............................................................           2,000           25.00          50,000
2025............................................................           2,000           25.00          50,000
2026............................................................           2,000           25.00          50,000
2027............................................................           2,000           25.00          50,000
2028............................................................           2,000           25.00          50,000
2029............................................................           2,000           25.00          50,000
                                                                 -----------------------------------------------
    Total.......................................................  ..............  ..............         350,000
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    Based on the primary estimate, costs total $62,670,250 over the 
seven-year period of analysis. Using a three percent discount rate, the 
annualized total costs are $8,799,855. See Table 17 for an annual 
breakdown and Table 18 for discounting.
---------------------------------------------------------------------------

    \74\ See Tables 13 and 14.

                                      Table 17--Total Costs to All Parties
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                  Costs to
                                  brokers--       Costs to        Costs to       Costs to CBP--
             Year                  primary       accreditors      providers     accrediting and     Total costs
                                  estimate                                      requesting \74\
----------------------------------------------------------------------------------------------------------------
2023.........................              $0          $5,727         $50,000            $19,753         $75,480
2024.........................       9,880,635               0          50,000                  0       9,930,635
2025.........................       9,880,635               0          50,000                  0       9,930,635
2026.........................       9,880,635           5,727          50,000             19,753       9,956,116
2027.........................      10,691,433               0          50,000            175,868      10,917,301
2028.........................      10,691,433               0          50,000            175,868      10,917,301

[[Page 41251]]

 
2029.........................      10,691,433           5,727          50,000            195,621      10,942,781
                              ----------------------------------------------------------------------------------
    Total....................      61,716,206          17,182         350,000            586,862      62,670,250
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.


                                        Table 18--Discounted Total Costs
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                             3%                                7%
                                             -------------------------------------------------------------------
                                                     PV               AV               PV               AV
----------------------------------------------------------------------------------------------------------------
 
Costs.......................................     $54,825,586       $8,799,855      $46,319,331       $8,594,701
----------------------------------------------------------------------------------------------------------------

6. Costs Not Estimated in This Analysis
    The parties affected by the rule will also face several, mostly 
minor costs that CBP is unable to quantify. To provide individual 
brokers who choose to file their triennial status report electronically 
through the eCBP portal the ability to self-attest to their continuing 
broker education completion, CBP will need to include a field within 
the triennial status report, which is submitted via the eCBP portal. 
The programming to include this field does not add significantly to the 
application development budget as CBP constantly makes small changes to 
many aspects of CBP's authorized electronic data interchanges.
    Additionally, some potential accreditors may face costs related to 
protesting CBP's initial decisions regarding their proposals to become 
accreditors. Accreditor-applicants have the right to protest in 
accordance with procedures set out in the Federal Acquisition 
Regulations System (FAR). CBP expects these costs to be minor and 
protests to be rare. Individual brokers' clients may see slight price 
increases for broker services. As individual broker costs increase, 
they may pass some of these costs onto their clients in the form of 
increased prices. However, CBP believes that the per transaction 
increase in prices will be so small as to be insignificant.
7. Benefits of the Rule
    This final rule will have many benefits to individual brokers, CBP, 
and the general public. CBP is able to estimate some of the benefits of 
the rule, but many others are qualitative in nature. Individual brokers 
will benefit from improved reputation and a professionalization of the 
customs broker community while their clients will benefit from better 
performance and improved compliance. The continuing broker education 
requirement will provide importers and drawback claimants with greater 
assurance that their agents are knowledgeable of customs laws and 
regulations, familiar with operational processes, and can properly 
exercise a broker's fiduciary duties. The requirements will also help 
maintain a measure of consistency across all customs brokers. Providers 
will benefit from increased prestige due to CBP-approved accreditation. 
Other benefits of the rule are quantitative.
    CBP will benefit from a reduction in regulatory audits of broker 
compliance. Both CBP and brokers will benefit from fewer errors 
committed by brokers and fewer penalties assessed by CBP. CBP examined 
data on broker penalties, regulatory audits, and validation activities 
between a group of companies who employ one or more individual brokers 
known to voluntarily hold an industry certification that requires 
meeting a continuing education requirement and the broader population 
of brokers (which includes those who voluntarily complete continuing 
education and those who do not). This group of individual brokers with 
continuing education represents about 120 companies, which make up 54 
percent of entries filed between 2017 and 2021 and 53 percent of 
entries filed between 2016 and 2021. CBP found that at the 99 percent 
confidence level, there is a statistically significant difference 
between these groups. Those who voluntarily hold this certification and 
complete continuing education have significantly lower rates of 
penalties, audits, and validation activities. See Table 19.\75\ 
Individual brokers who are not known to have continuing education are 
assessed 13 times as many penalties per entry filing, are audited seven 
times as often, and have nine times as many validation activities 
performed by CBP to investigate discrepancies when compared to 
companies that are known to employ individual brokers who voluntarily 
take continuing education.
---------------------------------------------------------------------------

    \75\ Source of data of companies with at least one individual 
broker with continuing education: data received from NCBFAA on 
companies participating in its broker certification program on April 
28, 2021. Data on enforcement actions and the number of entries per 
company was obtained from ACE on April 11, 2021.

[[Page 41252]]



                             Table 19--Enforcement Action Rate for Different Groups
----------------------------------------------------------------------------------------------------------------
                                                                                By 120 companies
              Enforcement action                    Total       By all other    with continuing        Ratio
                                                               companies  (%)    education (%)
----------------------------------------------------------------------------------------------------------------
Penalty......................................             337         0.00039           0.000031         13 to 1
Regulatory Audit.............................              90         0.00008           0.000011          7 to 1
Validation Activity..........................             515         0.00047           0.000051          9 to 1
----------------------------------------------------------------------------------------------------------------
* Rates are defined as the number of enforcement actions divided by the number of entries filed.

    Aside from penalties, CBP enforcement often takes the form of a 
regulatory audit. Regulatory audits usually occur because a CBP Officer 
or Import Specialist flags unusual or suspicious activity. CBP then 
performs a regulatory audit of the broker's activity, investigating the 
potential infraction, as well as the broker's overall compliance with 
regulations, rules, and CBP guidance. These audits may lead to a 
settlement agreement in which a penalty is assessed, but they more 
often lead to discussion between the broker and CBP as to how the 
broker can improve compliance and performance. With continuing 
education in place, CBP believes that fewer regulatory audits will be 
necessary. From 2016 to 2021, CBP performed 82 regulatory audits of 
broker compliance, for an average of 14 per year.\76\ The number of 
audits holds approximately steady across the five-year period, so CBP 
does not believe it likely that the number of audits will grow in the 
period of analysis. Therefore, CBP projects 96 audits will be performed 
during the seven-year period of analysis under baseline conditions, or 
14 each year. See Table 20.
---------------------------------------------------------------------------

    \76\ Data provided by CBP's Regulatory Audit and Agency Advisory 
Services Directorate on April 11, 2021, and January 31, 2022.

  Table 20--Projection of Audits and Broker Surveys Under the Baseline
------------------------------------------------------------------------
                          Year                                Audits
------------------------------------------------------------------------
2023....................................................              14
2024....................................................              14
2025....................................................              14
2026....................................................              14
2027....................................................              14
2028....................................................              14
2029....................................................              14
                                                         ---------------
  Total.................................................              96
------------------------------------------------------------------------
* Total does not sum due to rounding.

    CBP estimates that a regulatory audit of broker compliance takes 
CBP approximately 593 hours, on average.\77\ Based on the average 
fully-loaded wage rate for a CBP Trade and Revenue employee of $109.74 
per hour, we estimate the average broker audit costs $65,049. Based on 
a review of outcomes from the audits completed from 2016-2021, CBP 
estimates that approximately 40 percent will likely have been avoided 
had a continuing education requirement been in place. CBP believes 
that, had customs brokers been required to complete continuing 
education on an individual level, and, therefore, stayed current on the 
rules and regulations governing customs business, they would have made 
fewer errors and avoided the audits. Over a seven-year period of 
analysis under the terms of the rule, CBP estimates it will avoid 33 
audits, for a cost savings of $2,133,623. See Table 21.
---------------------------------------------------------------------------

    \77\ Audits conducted from 2015 to 2021 took, on average, 593 
hours to conclude. Data provided by the Regulatory Audit and Agency 
Advisory Services Directorate on January 31, 2022, based on internal 
metrics.

                       Table 21--CBP Cost Savings From Reduced Regulatory Audit Activities
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                                   Cost savings
                              Year                                Audits avoided     per audit     Total savings
----------------------------------------------------------------------------------------------------------------
2023............................................................               0              $0              $0
2024............................................................               5          65,049         355,604
2025............................................................               5          65,049         355,604
2026............................................................               5          65,049         355,604
2027............................................................               5          65,049         355,604
2028............................................................               5          65,049         355,604
2029............................................................               5          65,049         355,604
                                                                 -----------------------------------------------
    Total.......................................................              33         390,297       2,133,623
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    The number of penalties assessed against brokers between 2017 and 
2021 grew significantly. In 2017, CBP assessed 20 penalties, with 
another 21 penalties assessed in 2018. The number of penalties then 
jumped in 2019, to 119, with 106 penalties following in 2020 (see Table 
1, above). CBP assessed fewer penalties in 2021 relative to 2020, 
although, with 71 penalties assessed, the number did not return to 
2017/18 levels. Between 2017 and 2021, the number of penalties issued 
increased with a compound annual growth rate (CAGR) of 29 percent. The 
jump in penalties between 2019 and 2020 is likely attributable to 
changes in the environment surrounding antidumping and countervailing 
duty cases, and CBP does not believe that penalties per year will 
continue to grow at the same rate. This is confirmed by the decrease in 
penalties issued in 2021. Based on trends before and after the jump, we 
do not believe that the number of penalties assessed per year will 
consistently grow at any meaningful rate. The average number of 
penalties assessed per year of available data after the change in AD/
CVD duties (2019-2021) was 99. Based

[[Page 41253]]

on a 0 percent growth rate, CBP estimates that over the seven-year 
period of analysis from 2023 to 2029, CBP will assess 691 penalties, or 
an average of 99 penalties per year. See Table 22 for an annual count.

   Table 22--Projection of Penalties Assessed From 2022-2027 Under the
                                Baseline
------------------------------------------------------------------------
                          Year                               Penalties
------------------------------------------------------------------------
2023....................................................              99
2024....................................................              99
2025....................................................              99
2026....................................................              99
2027....................................................              99
2028....................................................              99
2029....................................................              99
                                                         ---------------
    Total...............................................             691
------------------------------------------------------------------------

    When CBP assesses a penalty against a broker for a customs 
violation, CBP incurs the cost of detecting and investigating the 
violation, as well as determining the appropriate monetary fine and 
handling any appeals from the broker. The broker must pay the penalty, 
which is capped at $30,000 by statute. CBP also works with brokers 
against whom a fine has been assessed to mitigate the penalty, 
resulting in the collection of amounts that are usually significantly 
lower. From 2017-2021, monetary penalties collected from individual 
brokers averaged $2,423. CBP estimates that the entire process of 
assessing a penalty against a broker, from detection to working through 
mitigation, costs CBP approximately $6,584 per penalty.\78\ With the 
rule implemented, CBP believes that individual brokers will commit 
approximately 20 percent fewer penalizable violations.\79\ As a result, 
individual brokers will save approximately $286,883 in fines avoided, 
while CBP will save approximately $779,593 in processing costs.\80\ See 
Tables 23 and 24.
---------------------------------------------------------------------------

    \78\ CBP bases this estimate on an average of 60 hours worked 
per penalty at an average fully-loaded wage of $109.74 per hour for 
a CBP Trade and Revenue employee, as described above.
    \79\ Approximately 20 percent of the penalties assessed between 
2017 and 2021 were for infractions that CBP believes would have been 
avoided had the individual broker been required to complete 
continuing education. CBP assumes the rule would eliminate all such 
violations. The majority of the remaining penalties were for late 
filing. Penalty data is taken from SEACATS.
    \80\ Penalties are a transfer payment from the broker to CBP 
that do not affect total resources available to society. 
Accordingly, CBP does not include penalties or penalties avoided in 
the final accounting of costs and benefits of this rule. In 
addition, penalties are an enforcement tool that are intended to 
bring a noncompliant party in line with existing requirements. Any 
costs and benefits that result from compliance with the underlying 
requirement are included in the analysis, but not the enforcement 
mechanism. In the same way, if a rule results in the seizure of 
illegal merchandise, CBP does not include the cost of the lost 
merchandise to the importers.

                                     Table 23--Penalties Avoided by Brokers
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                     Penalties     Fines avoided
                              Year                                    avoided       per penalty        Total
----------------------------------------------------------------------------------------------------------------
2023............................................................               0              $0              $0
2024............................................................              20           2,423          47,814
2025............................................................              20           2,423          47,814
2026............................................................              20           2,423          47,814
2027............................................................              20           2,423          47,814
2028............................................................              20           2,423          47,814
2029............................................................              20           2,423          47,814
                                                                 -----------------------------------------------
    Total.......................................................             118          14,538         286,883
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.


                                         Table 24--Costs Avoided by CBP
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                     Penalties     Cost savings
                              Year                                    avoided       per penalty        Total
----------------------------------------------------------------------------------------------------------------
2023............................................................               0              $0              $0
2024............................................................              20           6,584         129,932
2025............................................................              20           6,584         129,932
2026............................................................              20           6,584         129,932
2027............................................................              20           6,584         129,932
2028............................................................              20           6,584         129,932
2029............................................................              20           6,584         129,932
                                                                 -----------------------------------------------
    Total.......................................................             118          39,506         779,593
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

8. Net Impact of the Rule
    The rule will lead to costs for individual brokers in the form of 
tuition, travel expenses, opportunity cost, and time spent researching, 
registering for, keeping records of, and reporting continuing broker 
education. CBP will face the costs of designating accreditors and 
requesting records from individual brokers. Accreditors will incur the 
costs of responding to a CBP-issued RFP, and education providers will 
incur the costs of drafting applications and fees charged by the 
accreditors for reviewing their accreditation requests. CBP will also 
see cost savings (benefits) from avoided penalty assessment and avoided

[[Page 41254]]

regulatory audits. CBP has found that companies employing one or more 
brokers who complete continuing education are statistically less likely 
to face enforcement actions. Over a seven-year period of analysis, the 
primary estimate of the net costs totals $59,757,034 (see Table 25). 
Using a discount rate of three percent, annualized costs total 
$8,389,981 (see Table 26).
---------------------------------------------------------------------------

    \81\ Note that we only include costs of remaining compliant with 
the rule in the net costs. Similarly, we do not include penalties 
avoided in the final accounting of benefits.

                                     Table 25--Primary Estimate of Net Costs
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                              Year                                   Benefits          Costs      Net costs \81\
----------------------------------------------------------------------------------------------------------------
2023............................................................              $0         $75,480         $75,480
2024............................................................         485,536       9,930,635       9,445,099
2025............................................................         485,536       9,930,635       9,445,099
2026............................................................         485,536       9,956,116       9,470,580
2027............................................................         485,536      10,917,301      10,431,765
2028............................................................         485,536      10,917,301      10,431,765
2029............................................................         485,536      10,942,781      10,457,245
                                                                 -----------------------------------------------
    Total.......................................................       2,913,216      62,670,250      59,757,034
----------------------------------------------------------------------------------------------------------------


                         Table 26--Primary Estimate of Net Present and Annualized Costs
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                3%                              7%
                                                 ---------------------------------------------------------------
                                                        PV              AV              PV              AV
----------------------------------------------------------------------------------------------------------------
Savings.........................................      $2,553,632        $409,874      $2,162,922        $401,337
Costs...........................................      54,825,586       8,799,855      46,319,331       8,594,701
                                                 ---------------------------------------------------------------
    Net Costs...................................      52,271,953       8,389,981      44,156,409       8,193,364
----------------------------------------------------------------------------------------------------------------

    CBP presents four estimates of the net costs depending on the cost 
of training pursued by each individual broker. The low-cost path 
assumes all individual brokers will pursue only free trainings and 
forgo travel. In the medium-cost path, all individual brokers will 
pursue a mix of free and paid trainings and travel to a single 
conference or in-person event per year. In the high-cost path, all 
individual brokers will pursue all paid trainings and travel to two in-
person events or conferences per year. The primary estimate assumes 
that one third of individual brokers will choose each path. Overall, 
the quantifiable effects of the rule result in a net, annualized cost 
ranging from $2,583,379 to $13,988,561, using a three percent discount 
rate over the seven-year period of analysis. A summary of net costs 
under all four estimates presented in the analysis can be found in 
Table 27.

                                         Table 27--Summary of Net Costs
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                   Estimate                                   Value                     3%              7%
----------------------------------------------------------------------------------------------------------------
Primary.......................................  Net PV..........................     $52,271,953     $44,156,409
                                                Net AV..........................       8,389,981       8,193,364
Low...........................................  Net PV..........................      16,095,183      13,582,366
                                                Net AV..........................       2,583,379       2,520,252
Medium........................................  Net PV..........................      53,567,985      45,251,723
                                                Net AV..........................       8,598,002       8,396,603
High..........................................  Net PV..........................      87,152,692      73,635,138
                                                Net AV..........................      13,988,561      13,663,237
----------------------------------------------------------------------------------------------------------------

    As stated before, many benefits of the rule are qualitative. 
Individual brokers will benefit from improved reputation and a 
professionalization of the customs broker community while their clients 
will benefit from better performance, less non-compliance, and improved 
outcomes. Providers will benefit from increased prestige due to CBP-
approved accreditation. CBP believes that the combination of quantified 
benefits and unquantified benefits exceed the costs of this rule. CBP 
requested comment on this conclusion in the NPRM and received no 
comments in response.
9. Analysis of Alternatives
    Alternative 1: 72 hours every three years.
    Alternative 1 is the same as the chosen alternative except that the 
continuing broker education requirement would be raised to 72 hours 
each triennial period instead of 36 hours. This alternative is modeled 
on the Internal Revenue Service's (IRS) Enrolled Agent program, which 
requires 72 hours of continuing education every

[[Page 41255]]

three years.\82\ An enrolled agent is an individual who may represent 
clients in matters before the IRS and, like a licensed customs broker, 
must pass a rigorous examination to prove his or her knowledge and 
competence, making it a reasonable analog to the CBP program. Once the 
agent has passed the exam, he or she has unlimited practice rights, 
providing he or she completes the requisite continuing education.
---------------------------------------------------------------------------

    \82\ See Internal Revenue Service, Enrolled Agent Information 
(Apr. 6, 2021), available at https://www.irs.gov/tax-professionals/enrolled-agents/enrolled-agent-information.
---------------------------------------------------------------------------

    CBP has determined that 72 hours every three years would be 
inappropriate for individual brokers. Were CBP to mandate 72 hours of 
continuing broker education every three years, individual brokers who 
already voluntarily pursue continuing education would need to increase 
the amount of training they complete, often by 100 percent. Costs 
incurred by both individual brokers who do not already pursue 
continuing education and those who do would be much greater. Such a 
requirement would be too onerous, particularly for small businesses, 
which make up a significant proportion (approximately 39 percent) of 
the employers of individual brokers. CBP estimates that such a 
requirement would cost individual brokers up to $284,775,217 over a 
seven-year period of analysis, or about $17,770 per broker. See Table 
28.

                                         Table 28--Broker Costs Under a 72-Hour Continuing Education Requirement
                                                                   [2022 U.S. dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Low                           Medium                           High
                Year                        Brokers      -----------------------------------------------------------------------------------------------
                                                               Cost            Total           Cost            Total           Cost            Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
2023................................              13,952          $69.62        $582,803          $2,383     $19,946,058          $4,456     $37,300,226
2024................................              14,830           69.62         619,472           2,383      21,201,038           4,456      39,647,106
2025................................              14,830           69.62         619,472           2,383      21,201,038           4,456      39,647,106
2026................................              14,830           69.62         619,472           2,383      21,201,038           4,456      39,647,106
2027................................              16,026           69.62         669,431           2,383      22,910,855           4,456      42,844,558
2028................................              16,026           69.62         669,431           2,383      22,910,855           4,456      42,844,558
2029................................              16,026           69.62         669,431           2,383      22,910,855           4,456      42,844,558
                                     -------------------------------------------------------------------------------------------------------------------
    Total...........................              16,026          487.34       4,449,513          16,679     152,281,735          31,190     284,775,217
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    Alternative 2: 36 hours every three years.
    Alternative 2 is the chosen alternative.
    Alternative 3: CBP list of individual brokers voluntarily meeting 
continuing education standards.
    Under Alternative 3, instead of mandating any kind of continuing 
education program, CBP would release annually a list of brokerages or 
companies employing individual brokers who voluntarily provide 
continuing education to their broker employees. As with Alternative 1, 
qualifying events would include internal training, government-sponsored 
webinars, trade conferences and events, and other activities. CBP would 
draft this list each year by requesting that companies report whether 
they provide a continuing education program. CBP might request details 
from the company to ensure the training provided meets a certain 
threshold for quality and relevance.
    Under baseline conditions, CBP estimates that about 60 percent of 
individual brokers already complete continuing education on a voluntary 
basis. CBP does not believe that publishing a list of brokerages that 
provide continuing education would induce the remaining 40 percent of 
individual brokers to pursue continuing education, though some 
individual brokers might do so. Under Alternative 3, those individual 
brokers who already complete ongoing training would continue to do so, 
while many of those brokers who do not, would not, absent a mandate, be 
likely to change. CBP estimates that an additional five percent of 
brokers might begin a continuing education program in order to be 
included on CBP's list, representing about 201 additional 
companies.\83\ While fewer individual brokers would face the costs of 
tuition, travel, and record-keeping, approximately 801 would face these 
costs of continuing education over the seven-year period of analysis. 
Additionally, CBP would incur the costs of composing the list each year 
and companies employing individual brokers would face the costs of 
applying to be included on the list. Assuming two CBP personnel spend 
about 40 hours each, annually to compose the list, that one person from 
each company spends about 10 hours compiling and submitting information 
to CBP annually, and that one third of affected individual brokers 
choose each cost path, Alternative 3 results in costs of $10,654,089 
over the seven-year period of analysis. See Table 29.
---------------------------------------------------------------------------

    \83\ CBP assumes that large companies employing more than 100 
people already have a continuing education program. Therefore, those 
companies that would need to add continuing education in order to be 
included on CBP's list would likely be small to medium sized 
businesses, meaning there would be a significant number of them, 
employing a few brokers each.

                                    Table 29--Total Costs under Alternative 3
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                     Brokerage
                      Year                           CBP cost          costs       Broker costs        Total
----------------------------------------------------------------------------------------------------------------
2023............................................         $17,558        $270,324      $1,131,008      $1,418,891
2024............................................          17,558         270,324       1,202,815       1,490,697
2025............................................          17,558         270,324       1,202,815       1,490,697
2026............................................          17,558         270,324       1,202,815       1,490,697

[[Page 41256]]

 
2027............................................          17,558         270,324       1,299,820       1,587,702
2028............................................          17,558         270,324       1,299,820       1,587,702
2029............................................          17,558         270,324       1,299,820       1,587,702
                                                 ---------------------------------------------------------------
    Total.......................................         122,909       1,892,267       8,638,913      10,654,089
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    If only five percent more individual brokers elect to begin 
continuing education under the terms of Alternative 3, fewer non-
compliance actions would be avoided. CBP estimates that only an eighth 
as many penalties and audits would be avoided as compared to 
Alternative 2. Therefore, CBP and individual brokers would avoid two 
penalties and one audit annually, for a total cost savings of $60,692 
per year. However, CBP does not typically include avoided penalties in 
the overall accounting of costs and benefits of a rule. Therefore, over 
a seven-year period of analysis, Alternative 3 leads to $364,152 in 
cost savings.

                                   Table 30--Total Savings Under Alternative 3
                                               [2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
                                                                    Savings for     Savings for
                              Year                                    brokers           CBP        Total savings
----------------------------------------------------------------------------------------------------------------
2023............................................................              $0              $0              $0
2024............................................................               0          60,692          60,692
2025............................................................               0          60,692          60,692
2026............................................................               0          60,692          60,692
2027............................................................               0          60,692          60,692
2028............................................................               0          60,692          60,692
2029............................................................               0          60,692          60,692
                                                                 -----------------------------------------------
    Total.......................................................               0         364,152         364,152
----------------------------------------------------------------------------------------------------------------
* Totals may not sum due to rounding.

    One of the primary goals of the rule is to reduce compliance 
issues, penalties, and regulatory audits, and CBP does not believe that 
a system based on voluntary reporting would do enough to reach that 
goal. With only an additional five percent of brokers pursuing 
continuing education, Alternative 3 would not do enough to further 
professionalize the customs broker community, nor would their clients 
see an appreciable decline in compliance issues. Additionally, such a 
system would still result in a net cost of about $10.7 million over the 
seven-year period of analysis. Therefore, CBP believes that Alternative 
3 is less preferable than the chosen alternative.

B. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.), as amended 
by the Small Business Regulatory Enforcement and Fairness Act of 1996, 
requires agencies to assess the impact of regulations on small 
entities. 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 concern per the Small Business Act); 
a small organization (defined as any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field); or 
a small governmental jurisdiction (defined as a locality with fewer 
than 50,000 people). A small business within the Freight Transportation 
Arrangement Industry, the industry that employs individual brokers, is 
defined as one whose annual receipts are less than $20.0 million in 
2022 dollars ($17,274,816 in 2017 dollars, using the CPI to account for 
inflation), regardless of the number of employees.\84\ Data from the 
U.S. Census Bureau shows that approximately 96 percent of businesses in 
the Transportation Arrangement Industry (NAICS Code 448510) are small 
businesses (see Table 31). All businesses employing individual brokers 
under this NAICS Code are affected by this rule. Additionally, some 
small businesses may elect to become accreditors or training providers. 
Therefore, CBP concludes that this rule will affect a substantial 
number of small entities.
---------------------------------------------------------------------------

    \84\ Small business size standards are defined in 13 CFR 121.

[[Page 41257]]



            Table 31--Small Businesses in the Freight Transportation Arrangement Industry, 2017 \85\
----------------------------------------------------------------------------------------------------------------
                                                                Preliminary
                                 Number of       Number of     receipts (all   Receipts per
    Employment size \86\           firms         employees        firms,         firm ($)       Small business?
                                                               $1,000s) \87\
----------------------------------------------------------------------------------------------------------------
01: Total...................          15,104         265,192     $67,276,572      $4,454,222  ..................
02: <5......................           8,912          15,939       6,315,166         708,614  Yes.
03: 5-9.....................           2,731          18,025       5,392,992       1,974,732  Yes.
04: 10-19...................           1,524          20,288       5,870,163       3,851,813  Yes.
05: <20.....................          13,167          54,252      17,578,321       1,335,029  Yes.
06: 20-99...................           1,344          49,477      13,973,780      10,397,158  Yes.
07: 100-499.................             357          44,715      10,886,028      30,493,076  No.
08: <500....................          14,868         148,444      42,438,129       2,854,327  Yes.
09: 500+....................             236         116,748      24,838,443     105,247,640  No.
----------------------------------------------------------------------------------------------------------------

    Some small businesses may choose to apply to CBP to become 
accreditors. Those businesses will face the costs of applying to CBP, 
the potential costs of any protests they choose to file should they 
disagree with CBP's decision regarding their proposals, and the costs 
of being an accreditor. Small businesses may also choose to become 
training providers and to incur the costs of producing and providing 
trainings. However, CBP believes that those costs will be recouped by 
tuition and fees. CBP further expects any costs not directly covered by 
fees to be minor and included in general business expenses.
---------------------------------------------------------------------------

    \85\ United States Census Bureau, ``2017 County Business 
Patterns and 2017 Economic Census,'' Released March 6, 2020, https://www.census.gov/data/tables/2017/econ/susb/2017-susb-annual.html. 
Accessed March 15, 2021.
    \86\ Note that some of the categories are sums of other 
categories. For example, Category 8, <500, is a sum of Categories 2, 
3, 4, 6, and 7. Thus, Categories 7 and 9 are not consecutive, but 
represent all firms employing 100 or more people.
    \87\ The Survey of U.S. Businesses (SUSB) from which this data 
is taken is conducted in years ending in 2 and 7.
---------------------------------------------------------------------------

    Individual brokers employed by these small businesses will be 
required to attain 36 hours of continuing broker education every three 
years under the terms of the rule. They will also face the opportunity 
cost of attending trainings as well as the costs of recordkeeping, 
reporting, and participating in any continuing broker education record 
request initiated by CBP. Accordingly, the impacts of the rule to 
individual brokers and affected businesses will depend on if the 
individual broker currently meets the training requirements. Based on 
public comments in response to the ANPRM and discussions between CBP 
and various broker organizations, CBP estimates most large businesses 
employing individual brokers already provide, and often mandate, 
internal training and continuing education. CBP estimates that these 60 
percent of individual brokers already in compliance will not face new 
costs aside from recordkeeping and reporting. CBP estimates the 
remaining 40 percent of individual brokers, mostly at smaller 
businesses, will need to come into compliance with the rule. Using the 
primary estimate under which one third of individual brokers selects 
each cost tier, the total cost born by brokers in the first year in 
which they will face costs due to the rule (2024) is $9,880,635 (see 
Table 12, above). The rule will affect 5,932 individual brokers in that 
first year, for an average annualized cost of $1,666 per broker. The 
average annual receipts for small businesses in the Freight 
Transportation Arrangement Industry, according to the Census data in 
Table 31, is $2,174,357.\88\ The number of individual brokers employed 
by each business will vary among the small businesses in question, but 
assuming an average of four brokers per company,\89\ the cost of 
continuing education for each firm will be approximately $6,663 
annually, or about 0.3 percent of annual receipts. CBP generally 
considers effects of 1 percent or less of annual receipts not to be a 
significant impact. Accordingly, CBP certifies that this rule does not 
have a significant economic impact on a substantial number of small 
entities.
---------------------------------------------------------------------------

    \88\ To calculate this average, CBP totaled the annual receipts 
of firms qualifying as small businesses ($6,315,166, $5,392,992, 
$5,870,163, and $13,973,780 from Table 31 above), then multiplied by 
1000 to account for units. Finally, CBP divided by the total number 
of firms in those categories (8,912, 2,731, 1,524, and 1,344 from 
Table 31 above).
    \89\ Many brokerages are sole proprietorships and many employ 
individual brokers who supervise other employees. The average number 
of employees per firm is seven. CBP assumes the average firm employs 
four individual brokers and three other employees, such as human 
resource managers. CBP did not receive any comments on this 
assumption in response to the NPRM.
---------------------------------------------------------------------------

C. Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (Pub. L. 
104-13, 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 
the Office of Management and Budget (OMB). The collections of 
information contained in these regulations are provided for by OMB 
control number 1651-0034 (CBP Regulations Pertaining to Customs 
Brokers).
    The rule will require individual brokers to maintain records of 
completed continuing education (including, among others, the date, 
title, provider, location (if applicable), and credit hours) and 
certify the completion of the required number of continuing education 
credits on the triennial status report. Based on these changes, CBP 
estimates a small increase in the burden hours for information 
collection related to customs brokers regulations. CBP will submit to 
OMB for review the following adjustments to the previously approved 
Information Collection under OMB control number 1651-0034 to account 
for this rule's changes. The addition of the self-attestation and 
submission of records will add about 30-45 minutes (0.5-0.75 hours) per 
respondent.
CBP Regulations Pertaining to Customs Brokers
    Estimated Number of Respondents: 13,952.
    Estimated Number of Responses per Respondent: 1.
    Estimated Number of Total Annual Responses: 0.333.
    Estimated Time per Response: 31.5 minutes (0.525 hours).
    Estimated Total Annual Burden Hours: 2,442 hours.

VI. Signing Authority

    This document is being issued in accordance with 19 CFR 0.1(b)(1), 
which provides that the Secretary of the Treasury delegated to the 
Secretary of DHS authority to prescribe and approve regulations 
relating to customs revenue

[[Page 41258]]

functions on behalf of the Secretary of the Treasury for when the 
subject matter is not listed in paragraph 1(a)(i) of Treasury 
Department Order No. 100-16. Accordingly, this rule may be signed by 
the Secretary of DHS (or his or her delegate).

List of Subjects in 19 CFR Part 111

    Administrative practice and procedure, Brokers, Penalties, 
Reporting and recordkeeping requirements.

Amendments to Regulations

    For the reasons set forth in the preamble, Part 111 of title 19 of 
the Code of Federal Regulations (19 CFR part 111) is amended as set 
forth below:

PART 111--CUSTOMS BROKERS

0
1. The general authority citation for part 111 continues to read as 
follows:

    Authority:  19 U.S.C. 66, 1202 (General Note 3(i), Harmonized 
Tariff Schedule of the United States), 1624; 1641.


0
2. Revise the second sentence of Sec.  111.0 to read as follows:


Sec.  111.0  Scope.

    * * * This part also prescribes the duties and responsibilities of 
brokers, the grounds and procedures for disciplining brokers, including 
the assessment of monetary penalties, the revocation or suspension of 
licenses and permits, and the obligation for individual brokers to 
satisfy a continuing education requirement.

0
3. In Sec.  111.1, add the definitions ``Continuing broker education 
requirement'', ``Continuing education credit'', ``Qualifying continuing 
broker education'', and ``Triennial period'' in alphabetical order to 
read as follows:


Sec.  111.1  Definitions.

* * * * *
    Continuing broker education requirement. ``Continuing broker 
education requirement'' means an individual broker's obligation to 
complete a certain number of continuing education credits of qualifying 
continuing broker education, as set forth in subpart F of this part, in 
order to maintain sufficient knowledge of customs and related laws, 
regulations, and procedures, bookkeeping, accounting, and all other 
appropriate matters necessary to render valuable service to importers 
and drawback claimants.
* * * * *
    Continuing education credit. ``Continuing education credit'' means 
the unit of measurement used for meeting the continuing broker 
education requirement. The smallest recognized unit is half of one 
continuing education credit, which requires 30 minutes of continuous 
participation in qualifying continuing broker education, as defined in 
Sec.  111.103(a). For qualifying continuing broker education lasting 
more than 30 minutes, half of one continuing education credit may be 
claimed for every full 30 minutes of continuous participation 
thereafter. For example, for qualifying continuing broker education 
lasting more than 60 minutes but less than 90 minutes, only one 
continuing education credit may be claimed. In contrast, for qualifying 
continuing broker education lasting 90 minutes, 1.5 continuing broker 
education credits may be claimed.
* * * * *
    Qualifying continuing broker education. ``Qualifying continuing 
broker education'' means any training or educational activity that is 
eligible or, if required, has been approved for continuing education 
credit, in accordance with Sec.  111.103.
* * * * *
    Triennial period. ``Triennial period'' means a period of three 
years commencing on February 1, 1985, or on February 1 in any third 
year thereafter.
* * * * *

0
4. In Sec.  111.19, revise the first sentence of paragraph (c) to read 
as follows:


Sec.  111.19  National permit.

* * * * *
    (c) * * * A national permit issued under paragraph (a) of this 
section is subject to the permit application fee specified in Sec.  
111.96(b) and to the customs permit user fee specified in Sec.  
111.96(c). * * *

0
5. Amend Sec.  111.30 by revising the section heading and paragraph 
(d)(2) to read as follows:


Sec.  111.30  Notification of change in address, organization, name, or 
location of business records; status report; termination of brokerage 
business.

* * * * *
    (d) * * *
    (2) Individual. Each individual broker must state in the report 
required under paragraph (d)(1) of this section whether he or she is 
actively engaged in transacting business as a broker.
    (i) If the individual broker is actively engaged in transacting 
business as a broker, the individual broker must also:
    (A) State the name under which, and the address at which, the 
broker's business is conducted if he or she is a sole proprietor, and 
an email address;
    (B) State the name and address of his or her employer if he or she 
is employed by another broker, unless his or her employer is a 
partnership, association or corporation broker for which he or she is a 
qualifying member or officer for purposes of Sec.  111.11(b) or (c)(2);
    (C) State whether or not he or she still meets the applicable 
requirements of Sec. Sec.  111.11 and 111.19 and has not engaged in any 
conduct that could constitute grounds for suspension or revocation 
under Sec.  111.53; and
    (D) Report and certify the broker's compliance with the continuing 
broker education requirement as set forth in Sec.  111.102.
    (ii) If the individual broker is not actively engaged in 
transacting business as a broker, the individual broker must also:
    (A) State the broker's current mailing address and email address;
    (B) State whether or not he or she still meets the applicable 
requirements of Sec. Sec.  111.11 and 111.19 and has not engaged in any 
conduct that could constitute grounds for suspension or revocation 
under Sec.  111.53; and
    (C) Report and certify the broker's compliance with the continuing 
broker education requirement as set forth in Sec.  111.102.
* * * * *


Sec. Sec.  111.97 through 111.100  [Reserved]

0
6. Add and reserve Sec. Sec.  111.97 through 111.100.

0
7. Add subpart F, consisting of Sec. Sec.  111.101 through 111.104, to 
read as follows:

Subpart F--Continuing Education Requirements for Individual Brokers

Sec.
111.101 Scope.
111.102 Obligations of individual brokers in conjunction with 
continuing broker education requirement.
111.103 Accreditation of qualifying continuing broker education.
111.104 Failure to report and certify compliance with continuing 
broker education requirement.


Sec.  111.101  Scope.

    This subpart sets forth regulations providing for a continuing 
education requirement for individual brokers and the framework for 
administering this requirement. The continuing broker education 
requirement is for individual brokers, in order to maintain sufficient 
knowledge of customs and related laws, regulations, and procedures, 
bookkeeping, accounting, and all other appropriate matters necessary to 
render valuable service to importers and drawback claimants. Individual 
brokers will be required to certify completion of the continuing broker 
education requirement with the filing of their 2027

[[Page 41259]]

status report, required under Sec.  111.30(d), and every status report 
thereafter, in accordance with the provisions of this subpart.


Sec.  111.102  Obligations of individual brokers in conjunction with 
continuing broker education requirement.

    (a) Continuing broker education requirement. All individual brokers 
must complete qualifying continuing broker education as defined in 
Sec.  111.103(a), except:
    (1) During a period of voluntary suspension as described in Sec.  
111.52; or
    (2) When individual brokers have not held their license for an 
entire triennial period at the time of the submission of the status 
report as required under Sec.  111.30(d).
    (b) Required minimum number of continuing education credits. All 
individual brokers who are subject to the continuing broker education 
requirement must complete at least 36 continuing education credits of 
qualifying continuing broker education each triennial period, except 
upon the reinstatement of a license following a period of voluntary 
suspension as described in Sec.  111.52. Upon the reinstatement of a 
license following a period of voluntary suspension as described in 
Sec.  111.52, the number of continuing education credits that an 
individual broker must complete by the end of the triennial period 
during which the reinstatement of the license occurred will be 
calculated on a prorated basis of one continuing education credit for 
each complete remaining month until the end of the triennial period.
    (c) Reporting requirements. Individual brokers who are subject to 
the continuing broker education requirement must report and certify 
their compliance upon submission of the status report required under 
Sec.  111.30(d).
    (d) Recordkeeping requirements--(1) General. Individual brokers who 
are subject to the continuing broker education requirement must retain 
the following information and documentation pertaining to the 
qualifying education completed during a triennial period for a period 
of three years following the submission of the status report required 
under Sec.  111.30(d):
    (i) The title of the qualifying continuing broker education 
attended;
    (ii) The name of the provider or host of the qualifying continuing 
broker education;
    (iii) The date(s) attended;
    (iv) The number of continuing education credits accrued;
    (v) The location of the qualifying continuing broker education; and
    (vi) Any documentation received from the provider or host of the 
qualifying continuing broker education that evidences the individual 
broker's registration for, attendance at, completion of, or other 
activity bearing upon the individual broker's participation in and 
completion of the qualifying continuing broker education.
    (2) Availability of records. In order to ensure that the individual 
broker has met the continuing broker education requirement, upon CBP's 
request, the individual broker must make available to CBP the 
information and documentation described in paragraph (d)(1) of this 
section on or before 30 calendar days from the date of receipt of CBP's 
request. CBP can request that the information and documentation be made 
available for in-person inspection or be delivered to CBP by either 
hard-copy or electronic means, or any combination thereof.


Sec.  111.103  Accreditation of qualifying continuing broker education.

    (a) Qualifying continuing broker education. In order for a training 
or educational activity to be considered qualifying continuing broker 
education, it must meet the following two requirements:
    (1) Providers of qualifying continuing broker education. The 
training or educational activity must be offered by one of the 
following providers:
    (i) Government agencies. Qualifying continuing broker education 
constitutes any training or educational activity offered by CBP, 
whether online or in-person, and training or educational activity 
offered by another U.S. government agency, whether online or in-person, 
but only if the content is relevant to customs business as identified 
by CBP in coordination with the appropriate U.S. government agency when 
applicable. Accreditation is not required for trainings or educational 
activities offered by U.S. government agencies.
    (ii) Other providers requiring accreditation. Any other training or 
educational activity not offered by a U.S. government agency, whether 
online or in-person, will not be considered a qualifying continuing 
broker education, unless the training or educational activity has been 
approved for continuing education credit by a CBP-selected accreditor 
before the training or educational activity is provided.
    (2) Recognized trainings or educational activities. The training or 
educational activity must constitute one of the following:
    (i) A seminar, webinar, or a workshop, whether online or in-person, 
whether experienced live or recorded, that is conducted by an 
instructor, discussion leader, or speaker;
    (ii) A symposium or convention, with the exception of the 
attendance at a meeting conducted in accordance with the provisions of 
the Federal Advisory Committee Act, as amended (5 U.S.C. App.), whether 
online or in-person;
    (iii) Online coursework, a workshop, or a module, conducted as 
self-guided education, culminating in a retention test;
    (iv) The preparation of a subject matter for presentation as an 
instructor, discussion leader, or speaker at a training or educational 
activity described in paragraph (a)(2)(i) or (a)(2)(ii) of this 
section, subject to the requirements set forth in paragraph (b) of this 
section; and
    (v) The presentation of a subject matter as an instructor, 
discussion leader, or speaker at a training or educational activity 
described in paragraph (a)(2)(i) or (a)(2)(ii) of this section, subject 
to the requirements set forth in paragraph (b) of this section.
    (b) Special allowance for instructors, discussion leaders, and 
speakers. (1) Contingent upon the approval by a CBP-selected 
accreditor, an individual broker may claim half of one continuing 
education credit for each full 30 minutes spent:
    (i) Presenting subject matter as an instructor, discussion leader, 
or speaker at a training or educational activity described in paragraph 
(a)(2)(i) or (ii) of this section; or
    (ii) Preparing subject matter for presentation as an instructor, 
discussion leader, or speaker at a training or educational activity 
described in paragraph (a)(2)(i) or (ii) of this section.
    (2) The special allowance for instructors, discussion leaders, and 
speakers is subject to the following limitations:
    (i) For any session of presentation given at one time, regardless 
of the duration of that session, an individual broker may claim, at a 
maximum, one continuing education credit for the time spent preparing 
subject matter for that presentation pursuant to paragraph (b)(1)(ii) 
of this section.
    (ii) Per triennial period, an individual broker may claim, at a 
maximum, a combined total of 12 continuing education credits earned in 
accordance with paragraphs (b)(1)(i) and (ii) of this section.
    (3) Regardless of whether the training or educational activity is 
offered by a U.S. government agency or another provider, any 
instructor, discussion leader, or speaker seeking to claim continuing 
education credit in

[[Page 41260]]

accordance with paragraph (b)(1) of this section must obtain the 
approval of a CBP-selected accreditor.
    (c) Selection of accreditors. The Office of Trade will select 
accreditors based on a Request for Information (RFI) and a Request for 
Proposal (RFP) announced through the System for Award Management (SAM) 
or any other electronic system for award management approved by the 
U.S. General Services Administration, in accordance with the Federal 
Acquisition Regulation (48 CFR 1.000 et seq.), for a specific period of 
award, subject to renewal. The Executive Assistant Commissioner, Office 
of Trade, will periodically publish notices in the Federal Register 
announcing the criteria that CBP will use to select an accreditor, the 
period during which CBP will accept applications by potential 
accreditors, and the period of award for a CBP-selected accreditor.
    (d) Responsibilities of CBP-selected accreditors. CBP-selected 
accreditors administer the accreditation of trainings or educational 
activities other than those described in paragraph (a)(1) of this 
section for the purpose of the continuing broker education requirement 
by reviewing and approving or denying such educational content for 
continuing education credit. A CBP-selected accreditor's approval of a 
training or educational activity for continuing education credit is 
valid for one year, and the accreditation may be renewed through any 
CBP-selected accreditor. CBP-selected accreditors will not deny review 
or approval of a training or educational activity for continuing 
education credit solely because it was previously denied by the CBP-
selected accreditor or any other CBP-selected accreditor.
    (e) Prohibition of self-certification by an accreditor. CBP-
selected accreditors may not approve their own trainings or educational 
activities for continuing education credit.


Sec.  111.104  Failure to report and certify compliance with continuing 
broker education requirement.

    (a) Notification by CBP. If an individual broker is subject to the 
continuing broker education requirement pursuant to Sec.  111.102 and 
submits a status report as required under Sec.  111.30(d)(2) but fails 
to report and certify compliance with the continuing broker education 
requirement as part of the submission of the status report, then CBP 
will notify the individual broker of the broker's failure to report and 
certify compliance in accordance with Sec.  111.30(d). The notification 
will be sent to the address reflected in CBP's records or transmitted 
electronically pursuant to any electronic means authorized by CBP for 
that purpose.
    (b) Required response to notice. Upon the issuance of such 
notification, the individual broker must on or before 30 calendar days:
    (1) Submit a corrected status report that, in accordance with Sec.  
111.30(d), reflects the individual broker's compliance with the 
continuing broker education requirement, if the individual broker 
completed the required number of continuing education credits but 
failed to report and certify compliance with the requirement as part of 
the submission of the status report; or
    (2) Complete the required number of continuing education credits of 
qualifying continuing broker education and submit a corrected status 
report that, in accordance with Sec.  111.30(d), reflects the 
individual broker's compliance with the continuing broker education 
requirement, if the individual broker had not completed the required 
number of continuing education credits at the time the status report 
was due.
    (c) Suspension of license. Unless the individual broker takes the 
corrective actions described in paragraph (b)(1) or (b)(2) of this 
section on or before 30 calendar days from the issuance date of the 
notification described in paragraph (a) of this section, CBP will take 
actions to suspend the individual broker's license in accordance with 
subpart D of this part.
    (d) Revocation of license. If the individual broker's license has 
been suspended pursuant to paragraph (c) of this section and the 
individual broker fails to take the corrective actions described in 
paragraph (b)(1) or (b)(2) of this section on or before 120 calendar 
days from the issuance date of the order of suspension, CBP will take 
actions to revoke the individual broker's license without prejudice to 
the filing of an application for a new license in accordance with 
subpart D of this part.

Alejandro N. Mayorkas,
Secretary, Department of Homeland Security.
[FR Doc. 2023-12921 Filed 6-22-23; 8:45 am]
BILLING CODE 9111-14-P