U.S. Customs Exams Explained

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What to Expect

U.S. Customs exams can happen to the best of us.  And it is what one might say luck of the draw if you’re importing into the United States.  It can cause major delays and become very expensive, very quickly. Now, there are ways to change that luck, but for the most part, it is somewhat out of the importer’s control as to whether or not a shipment is flagged for exam or manifest hold.

Why the Exams?

Remember, the U.S. Customs and Border Protection applies these cargo examinations to keep our country secure. In addition to its own regulations, CBP enforces over 400 laws on behalf of over 40 other U.S. Government agencies, such as USDA, FDA, Fish & Wildlife just to name a few. A large number of these import restrictions and requirements are designed to protect the American people from dangerous and illegal goods. CBP has undertaken a number of initiatives, such as the use of non-intrusive inspection technology, to increase its ability to examine cargo effectively without slowing the flow of trade, which plays a significant part in the U.S. economy.

One must also consider that a U.S. Customs broker does not have any say when it comes to these exams. With that being said, the physical location of the exam can be very beneficial.  For example, exams that take place at busy port terminals or airports will probably take a lot longer to occur than exams that take place in smaller ones. Also, having your freight transferred to an in-bond warehouse or facility is beneficial so one can avoid storage fees and increase the chances that the exam will be completed quicker.

“Our Customs bonded facility allows our clients to transfer their precious cargo from the airline or rail to our warehouse. U.S. Customs agents can then come to our facility and inspect the freight right here in house. There are many benefits to this including speeding up the process and release of goods,” says Alyson Schroer, Licensed Customs Broker for Scarbrough International, Ltd.

How many exams per year?

Nobody knows the exact methodology used to determine who gets selected and who doesn’t, and only 3-5% of the cargo coming into the U.S. gets picked for examination.  Exams can occur on random or if something looks fishy to a CBP officer.

Types of US Customs holds:

The following CBP holds can occur at time of clearing. Your U.S. Customs broker will typically be notified of the hold and in some cases even take care of a hold without the importer even knowing. If there are any discrepancies, then the U.S. Customs broker will involve the importer. It is the ultimate responsibility of the importer of record to relay pertinent information, details of product and decide on the HTS Classification they want filed with CBP.


Most Common Types of Holds or Physical Cargo Examinations:

  1. Manifest Hold / MET Hold

    Goods are manifested with CBP prior to entering the U.S. In this case, CBP may want to verify the manifested information and will request for documentation.  The U.S. Customs broker will work with the importer and CBP to ensure CBP receives all the information they require. In this type of hold, a CBP officer may want to physically examine a shipment based on suspicious activity in the AMS or ISF entry. These are the data elements that are required to be submitted prior to sailing.  Typically products that will flag concern are those that fit the description of something disruptive to our security such as heavy dense cargo or for example, a car part  manufacturing company that suddenly imports shoes. Things that raise any type of concern can warrant an examination.

  2. CET Hold

    A Contraband Enforcement Team (CET) Hold requires more information on consumer product safety standards, copyright or trademark, or ensuring correct HTSUS classification and valuation of commodities. This also encompasses drugs, alcohol, narcotics, weapons; anything that can put a threat on U.S. security.  Also, it requires a physical inspection of cargo.

  3. VACIS Exam/NII

    A Vehicle and Cargo Inspection System (VACIS) or Non-Instrusive Exam is an x-ray exam which is performed right at the terminal.  Much like luggage scans at the airport, a VACIS scans the entire container without breaking the seal. This exam is typically pretty quick and may only delay a shipment by one day.

  4. Tailgate Exam

    CBP Officers will simply open the container and look through a  couple of boxes.  Whereas an intensive is a little more intense.  See below.

  5. Intensive Exam

    An intensive exam requires a transfer to a Centralized Examination Station (CES) or Customs-bonded facility. CBP officers will physically open the shipment and inspect it hands-on. Depending on which port, this process can delay a shipment anywhere from 24 hours up to 2 weeks. This can be triggered from random generation, risk assessments, a PGA officer, a CBP officer, or a suspicious VACIS or NII Exam. Furthermore, this becomes costly because the importer is required to pay for the transfer to the CES, any storage, handling or other charges that may occur.

  6. USDA Exam

    A USDA Exam physically inspects the cargo for outside pests or anything that will disrupt or harm the U.S. environment. You can check out what the USDA does for our country to protect it, including keeping our containers free of harmful pests.


What can I do to avoid US Customs exams?

For new importers, this one is tough. If you are a new importer, your first couple of shipments will most likely go through some sort of US Customs exam.  However, here are some tips to take to help avoid future exams:

  1. Have reliable partners in place (ie. shipper, freight forwarder, US Customs broker) prior to completing the purchase
  2. If you plan to import more than one time, purchase a continuous bond.
  3. Speak with your partner and send documents prior to completing the purchase
  4. File ISF on time
  5. Ensure your HTS number is correct
  6. Ensure your valuation is correct
  7. Avoid importing from high-risk countries
  8. Find out required licensing or certificates from partner government agencies that may be involved
  9. Research quota information and quota requirements for certain commodities prior to importing. Check out this guide here.
  10. Follow Tip Number 1

 

 

For more frequent importers, the Customs Trade Partnership Against Terrorism (CTPAT) is highly recommended. The CTPAT is a program that emphasizes security in the supply chain, allowing CBP to bypass exams on this kind of cargo knowing it is already secure.

CTPAT members are considered to be of low risk, and are therefore less likely to be examined at a U.S. port of entry.

CTPAT Benefits

1. Reduced number of CBP examinations
2. Front of the line inspections
3. Possible exemption from Stratified Exams
4. Shorter wait times at the border
5. Assignment of a Supply Chain Security Specialist to the company
6. Access to the Free and Secure Trade (FAST) Lanes at the land borders
7. Access to the CTPAT web-based Portal system and a library of training materials
8. Possibility of enjoying additional benefits by being recognized as a trusted trade Partner by foreign Customs administrations that have signed Mutual Recognition with the United States
9. Eligibility for other U.S. Government pilot programs, such as the Food and Drug Administration’s Secure Supply Chain program
10. Business resumption priority following a natural disaster or terrorist attack
11. Importer eligibility to participate in the Importer Self-Assessment Program (ISA)
12. Priority consideration at CBP’s industry-focused Centers of Excellence and Expertise

To undergo a CTPAT certification is a process including foreign site visits and extensive applications. Scarbrough is proud to be CTPAT certified and has helped a number of importers and exporters do the same.  Scarbrough’s consulting team is happy to help.


For more information on CTPAT, click here.

To talk to someone about CTPAT, click here or call 816-584-2414.

To talk to a Supply Chain Specialists or Licensed U.S. Customs Broker, email us.

 

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