Mandatory AES

Issue 49, September 9, 2008

“The Foreign Trade Division of the U. S. Bureau of the Census, the agency responsible for publishing trade statistics, published the Final Rule for the implementation of mandatory electronic Automated Export System filings on June 2, 2008. This final rule became effective on July 2, 2008 and all parties involved with United States foreign trade have until September 30, 2008 to implement all of its provisions.

This event is significant for you as an exporter as the revised provisions of the Foreign Trade Regulations, (“FTR”) will likely affect the information on your company’s exports. Whether you file your own AES Electronic Export Information or authorize a cargo agent to file on your behalf, it is more important than ever that your information be complete and accurate.

This letter provides you with an overview of the changes from the previous Foreign Trade Statistics Regulations, (“FTSR”) and clarifies previously existing requirements for information from United States Principal Parties in Interest in “routed export” transactions.

What is New?

1. The Foreign Trade Statistics Regulations will now be called the Foreign Trade Regulations.
2. The Shipper’s Export Declaration (Form V-7525) can no longer be presented manually to border enforcement agents. All transactions will require electronic reporting.
3. The export record will no longer be called the SED, and the data submitted in AES will now be referred to as the Electronic Export Information, (“EEI”).
4. The language has changed to now allow a Foreign Principal Party in Interest (FPPI) to authorize a US Principal Party in Interest (USPPI) to file the AES in a “routed” export transaction.
5. The post-departure (formerly Option 4) approval process is revised.
6. New deadlines exist in Part 30.4 for pre-departure self-filers or filing agents where the internal transaction number (X2008072912345678) must now be available prior to departure:
   1. Vessel Cargo = 24 hours prior to loading cargo on vessel,
   2. Air Cargo (including Air Express Couriers) = 2 hours prior to scheduled
      departure of aircraft,
   3. Truck Cargo (including Express Consignment Couriers) = 1 hour prior
      to arrival of the truck at the U. S. border to go foreign,
   4. Rail Cargo = 2 hours prior to arrival of train at U. S. border to go foreign,
   5. Mail and other cargo = no later than 2 hours prior to exportation

1. There are new downtime rules when the CBP computer is down.
2. There are newly established procedures for reporting the value of goods when inland
   freight and insurance charges are not yet known at the time of shipment.
3. There are newly established requirements to use the Internal Transaction Number
   (ITN) instead of the External Transaction Number (XTN) as filing citations on transport
   and loading documents.
4. Internet sales resulting in an export require AES filings.
5. The new Sub-Part H to Part 30 has been created to address fines and penalties:
   1. From $100 per day to $1100 per for each day the AES record
      remains uncorrected, per violation, up to a maximum of $10,000 per
      filing error.
   2. Includes provisions for penalties for knowingly failing to file, filing late,
      or filing false or misleading information.
   3. Increases the AES enforcement agencies to three by adding the Office
      of Export Enforcement, (OEE) and Immigrations and Customs Enforcement, (ICE) to Customs and Border Protection.

Clarification of Routed Exports:

The Foreign Trade Division (FTD) currently defines a routed transaction as…

“… transaction in which the FPPI authorizes a U.S. agent to facilitate export of items from the United States on its behalf and prepare and file the EEI.” (FTR Part 30.1)

In this latest revision, the FTD has introduced language that allows a Foreign Principal Party in Interest to authorize a US Principal party in Interest to file the AES EEI, while still preserving the nature of the routed export.

Historically, this transaction has caused confusion with United States exporters that have been reluctant to provide the EEI because they did not select the cargo agent. While the US government does recognize the limited liability to the USPPI, brought about by the routed export, it has in the past and continues to require EEI from the USPPI.

The following section outlines the information (FTR Part 30.3 (e) (1)) now requires from the USPPI in routed exports.

1. Name and address of the USPPI.
   
   
2. USPPI’s EIN or SSN.
   
   
3. State of origin (State).
   
   
4. FTZ if applicable.
   
   
5. Commercial description of commodities.
   
   
6. Origin of goods indicator: Domestic (D) or Foreign (F).
   
   
7. Schedule B or HTSUSA, Classification Commodity Code.
   
   
8. Quantities/units of measure.
   
   
9. Value.
   
   
10. Export Control Classification Number (ECCN) or sufficient technical information to
    determine the ECCN.
    
    
11. All licensing information necessary to file the EEI for commodities where the
    Department of State, the Department of Commerce, or other U.S. government
    agency issues a license for the commodities being exported, or the merchandise
    is being exported under a license exemption or license exception.
    
    
12. Any information that it knows will affect the determination of license authorization
    (see Subpart B of this part for additional information on licensing requirements).

For clarification on these and other “Mandatory AES” issues, please contact the Foreign Trade Division at the Bureau of the Census at: http://www.census.gov/foreign-trade/contacts/whowho.html

For further information or questions, please contact Ken Hughes at ken.hughes@dhl.com or via phone at 847-233-7923.

Sincerely,

Ken Hughes
U.S. Director
Export Compliance, TSA Security, Dangerous Goods