Everyone who is filing ISFs by now knows that they are still not seeing any monetary penalties being issued by customs. While this is a good thing, you have to ask yourself why is it being delayed? It was reported that penalities would be assessed by the fourth quarter of 2010. Is it because everyone filing an ISF is in compliance? According to the progress reports being sent out by customs the answer is no.
So what gives? We have seen numerous reports of untimely filings. The standard is that the ISF should be reported 24 hours prior to vessel loading. Customs has reported that more than 90 percent of shipments comply with this filing deadline while only 2.5 percent are rejected for being inaccurate or incomplete.
We have been told by customs that the reports on timeliness are not perfect and probably won't be. It still takes human intervention to catch errors made on these reports and customs is working to improve the problem with each new release that comes out. Meanwhile the client should be protected from fines or penalties.
Customs has under law a six-year window to find an ISF violation and issue damages. What will this mean to the importer down the road? Once all the "bugs" are worked out, will customs then proceed to go back and fine violators on past proformance? It will be interesting to see how this plays out and how the implementation of ACE will benefit filers to extract their own data for the reporting of ISFs going forward.
Check back next month for more on ACE.
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