NEWS 2009

We are pleased to announce that all divisions of Fracht USA are now validated C-TPAT members.

After a lengthy process, that included visits to our agent and CFS in Peru by Inspectors from U.S. Customs, our NVOCC and Forwarding divisons are officially validated. This is also known as Tier 2 C-TPAT membership, which is the highest level available to transportation providers.

• Fracht USA (Forwarder & NVOCC) Certificate
• Fracht USA (Customs Broker) Certificate

US Customs and Border Protection (CBP) recently released an updated frequently asked questions document regarding its Importer Security Filing (ISF) initiative, which includes bond-related clarifications. When CBP's flexible enforcement period ends January 26, 2010, all ISFs must be secured by a bond. Importers are encouraged to read the complete FAQ, but a summary of the bond information can be found below.

• CBP will be amending Appendix D of the ISF regulations to reflect that the bond may be executed as a single transaction or as a continuous bond.
• ISF transactions must be secured by a bond for most transactions, but CBP has identified five exceptions to the requirement including personal effects and household goods, government and military, carnets, diplomatic, and international mail.
• ISF filings must be secured using a continuous CBP Form 301 (Activity Code 1, 2, 3, or 4) or the ISF bond (single transaction or continuous).
• Single transaction ISF bonds must be secured if a filer does not have a continuous CBP Form 301 bond, a continuous ISF bond, or utilize a unified filing.
• For ISF purposes, the use of single entry bonds on CBP Form 301 is allowed only when filing a unified entry (entry and ISF). A single entry bond can be used, but must identify Activity Code 1 (basic importation), bond type 9 (single entry), surety code, and the bond reference number.
• When a single transaction ISF bond is used, an electronic copy of the bond must be sent by email as a .pdf attachment within 12 hours of receiving the unique ISF transaction number from CBP. The attachment should be emailed to ISF_Bond@cbp.dhs.gov with a subject line noting the unique ISF transaction number.
• The single transaction ISF bond limit of liability must be set at $10,000.

Fracht USA will continue to provide updates on ISF. For more information, review the FAQs in their entirety or contact a Fracht USA trade specialist at isf@fracht.com.

We are pleased to announce the opening of our newest office in Munich at the following address:

FRACHT FWO AG
Liaison Office
Ottobrunner Strasse 1
81737 Munich / Germany

Phone: + 49 89 - 37916844
Fax:     + 49 89 - 37418452
E-mail: Thomas.Schunter@fracht-nue.de

This office will handle oceanfreight shipments from the Southern Bavaria Region as well as all traffic to Malta. 

On Friday July 31, 2009 the National Guard of Venezuela took over the Terminals/Warehouses of the Ports of Venezuela. With immediate effect the Warehouse / Terminal Operators have to hand over the handling equipment / storage facilities / IT equipment etc., to the government without any delay.

The Port operation is continuing with reduced staff, as the former Terminal/Warehouse Managers were forced to leave the company. Possible delays and new congestion out of this situation can not be excluded. Higher storage and handling charges at the ports are expected and unified tariffs will be announced with in 45 days. All previous negotiations between the warehouses and clients/forwarders will/are suspend/ed; standard tariff are going to apply for all clients/forwarders with immediate effect.

Pls. be informed about recent handling procedures for Venezuela which take place with immediate effect, and we highly recommend you follow:

• Consolidated sea freight shipments are suspended until new notification for all Venezuela ports. This includes co-loader shipments.
• DDU Tariff agreements are suspended because of the new tariff structure to be implemented by the government.
• FCL containers are only be confirmed under CFR / CIF Term.
• High Valuable Cargo (HVC) has to be reviewed from case to case and will be approved by VE Management.

US Customs and Border Protection (CBP) recently released Importer Security Filing (ISF) mitigation guidelines for issuing liquidated damages for failure to comply with the interim final rule's requirements.  The guidelines became effective on July 17, 2009.  Below are scenarios that can result in liquidated damages:

• Late filing - If an importer submits a late ISF, then CBP may assess a $5,000 liquidated damage claim for each late ISF.
• Inaccurate filing - If an importer submits an inaccurate ISF, then CBP may asses a $5,000 liquidated damage claim for each inaccuracte ISF.
• Withdrawals - If an importer does not withdraw an ISF as required by 19 CFR 149.2(e), then CBP may assess a $5,000 liquidated damage claim.  
• Updates - If am importer submits an inaccurate ISF update, CBP may assess a $5,000 liquidated damage claim for the first inaccurate ISF update.
• Failure to file - Liquidated damages will not be assessed for failure to file an ISF if there is not a bond in place.  However, CBP will not release the cargo for delivery until the required ISF information is provided and they have reviewed the documentation.  CBP also reserves the right to not permit unlading of merchandise for shipments where an ISF was not filed.  Additionally, if such cargo is unladen without permissions, it may be subject to seizure.  

If an importer receives a liquidated damages claim for a first violation of filing a late or inaccurate ISF or an inaccurate ISF update, the claim may be cancelled by paying between $1,000 to $2,000 depending on mitigating or aggravating factors.  If there are subsequent violations, the liquidated damages claim may be cancelled by paying no less than $2,500 depending on mitigating or aggravating factors.  However, no relief to liquidated damages will be granted if CBP determines that law enforcement goals were compromised by the violation.  

CBP will look at all available information and take into account any mitigating, aggravating, and extraordinary factors when determining the final assessed claim for liquidated damages or penalties.  Below are examples of mitigating and aggravating factors (not a complete list):

Mitigating factors:

• Show progress in conforming to the ISF requirements during the flexible enforcement period.  (January 26, 2009 through January 26, 2010)
• Few violations when compared to the number of shipments requiring an ISF.
• C-TPAT tier 2 and 3 members may receive up to 50 percent of the normal mitigation amount
• Importer shows steps have been taken to prevent future violations
• ISF information was filed late due to factors outside of the importer's control, such as ship diversion due to weather.
• In regards to an inaccurate filing, the party acquired the information from another party in accordance with normal business practices, and can show that they reasonably believed the information was accurate, and it was not reasonably able to verify the information.  

Aggravating factors:

• Lack of cooperation with CBP
• Multiple errors on the ISF
• Error rate continues to rise, which is indicative of deteriorating performance in the transmission of ISF information
• Evidence of smuggling or attempt to import merchandise contrary to law

For more information on how to comply with the requirements of the Importer Security Filing or how Fracht can assist you with this new process, please contact us at ISF@fracht.com.

The attachment is a copy of a power point presentation made by Mr. Joseph Martella of CBP to the shipping trade at JFK Airport on February 5th and 6th on the subject of Importer Security Filing.

The U.S. Department of Homeland Security confirmed today that it will not extend the effective date for new information requirements on maritime cargo destined for the United States.

The Importer Security Filing and Additional Carrier Requirements interim final rule, scheduled to go into effect today, January 26, now requires maritime cargo carriers and importers to submit additional data to U.S. Customs and Border Protection before vessels are permitted entry into the country.

The determination not to postpone the January 26 effective date was made after consideration of the factors set forth in the memorandum from the director of the Office of Management and Budget, “Implementation of Memorandum Concerning Regulatory Review,” dated January 21.

The decision was based in large part on the fact that the rulemaking process was procedurally adequate; that a 75-day public comment period was already provided to respond to the Notice of Proposed Rulemaking; and, that this Interim Final Rule is now subject to an additional six-month public comment period. The January 26 effective date will also allow CBP to work with industry on testing and improving the systems of this important security initiative during the structured review and delayed enforcement period which ends a year later on January 26, 2010.

This additional information will be critical to enhancing the department’s ability to identify and stop dangerous goods from entering our nation, and CBP will continue to welcome input from the regulated industry.

For more information to to http://www.cbp.gov/xp/cgov/newsroom/news_releases/january_2009/01262009.xml.