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Importer Security Filing Vendor & Supplier Compliance

Are you still contemplating how to establish and enforce the advanced data reporting requirements under Importer Security Filing? Like preparing for a 400-meter relay, good communication and training is imperative, especially with something like this that carries stiff monetary penalties or that could result in a “Do Not Load” message next January and requires significant change to the current methods in place for centuries. Is your supply chain ready to hand off your ISF baton?

Importer Security Filing Preparation

To reinforce the necessity for the ten (10) ISF data (excluding the bill of lading number, called the “phantom eleventh”) elements, we strongly suggests that you consider amending your purchase order or other contractual agreements used in the transaction to require the vendor or supplier’s compliance with ISF requirements. Some importers are also adding conditions to financial instruments like letters of credit. Placing such language in your contractual documents could prove to be a mitigating factor if CBP issues you a penalty for untimely or inaccurate data after January 2010.

We also suggest that you contact and closely coordinate activities with the ocean carriers, NVOCC’s and freight forwarders that participate in your import program. Meetings between your supplier base and the carrier(s) at origin should be implemented for purposes of ironing out new protocols and procedures for issuing the bill of lading number in advance. Most major ocean carriers (Maersk, APL/NOL, Evergreen, Hanjin, NYK, K-Line, OOCL and others) are well informed on ISF; therefore, if leveraged properly, their overseas offices can assist you with educating your vendor and supplier base. We recommend that you contact your US-based carrier representative and request their overseas offices engage problematic vendors or otherwise help you communicate this new requirement.

If your ISF baton is dropped between transfers, immediate disqualification may occur. Some importers are instituting vendor penalties through their vendor compliance programs to incentivize compliance and to help offset the potential cost of CBP penalties levied against the importer.

Suggested Notifications For Your Suppliers & Vendors

It seems that the two most troubling situations for importers right now are the inability to get the bill of lading number in advance and/or lack of suppliers and vendors. If you are currently direct filing with TRG Direct, you can access these letters within your account under Resources. Suggested reading or attachments to your correspondence might include an Adobe copy of CBP Interim Final Rule (Federal Register Notice), copies of your new company polices or procedures, copies of other publications concerning ISF, and/or letters underscoring the importance and their support for the initiative from Senior Management.

Our ISF direct filing customers are free to use our suggested language or some variation thereof for their company or particular situation in an effort to get compliance with their ISF program; of course, the tone can also be adjusted according to personal preferences and corporate culture.

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Trade Risk Guaranty (TRG) Brokerage Services LLC is a licensed insurance agency, having agency agreements with Hanover Insurance Company of Worcester, Massachusetts and Hudson Insurance Company of New York, New York, both of which are insurance companies approved by the Department of the U.S. Treasury to issue U.S. Customs bonds.

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