With the final deployment of the Automated Commercial Environment (ACE) Feb. 24, many importers, exporters, brokers, and other users of ACE are asking: Did US Customs and Border Protection (CBP) deliver as promised?
For the most part, the answer is yes. CBP was supposed to deliver ACE with all the functionality available in the old Automated Commercial System (ACS) and has largely done so. In a few areas CBP simply ran out of time and money and was forced to create workarounds or not deliver functionality. But most of the outstanding issues are the result of either new laws and regulations (the Trade Facilitation and Trade Enforcement Act and drawback are prime examples) or users needing to become familiar with functionality that is different in ACE than it was in ACS.
One notable example of a missing piece of functionality is the electronic invoice module that was available in ACS but is not available in ACE. The workaround in ACE for the electronic invoice is better in some cases than it was in ACS but worse for more sophisticated importers who invoice electronically. In ACS, if the import specialist wanted to see the invoice for an entry, the broker would courier the paper documents to CBP or key in data from the invoice and transmit it to ACS. In ACE, the only option for transmitting the invoice to CBP is to send a scan using the Document Image System (DIS). For importers whose invoices are completely electronic, an electronic invoice module in ACE would streamline the process and enable ACE to analyze the data as opposed to having an import specialist review a paper or a PDF. For importers who provide invoices in alternative, non-data, formats (PDF, Excel, paper, etc.) the DIS option may be a superior option for CBP as the import specialist can review an actual copy of the invoice as opposed to data keyed in by the broker.
Currency conversion is another ACS function that was not carried over to ACE. When importers purchase merchandise in a foreign currency they must convert the amounts to dollars before they file the entry. In ACS the currency tables were updated daily and the broker could simply query ACS to find the conversion rate for any currency. CBP was going to leave the currency conversion in ACE up to the individual brokers but the trade pushed back. For now, currency conversion is one of the few functions to remain in ACS. CBP is planning on delivering currency conversion in ACE but when it will be delivered (and what functionality it will have, e.g., conversion from bitcoin to dollars) is still unknown.
E-commerce era creates additional demands
With the explosion of e-commerce and the increase in the de minimis level for imports, CBP and the trade agree that there is a need to automate the Section 321 entry. Shipments valued under $800 can be imported free of duty by using the Section 321 process, but ACE does not have the ability to accept Section 321 shipments electronically. On the other hand, neither did ACS.
An example of functionality that exists in ACE but is different than ACS is filing protests and post-entry free trade agreement claims (often referred to as 520(d) claims). Brokers and others with specialized software could file such claims and protests in ACS, but no such software is required to file in ACE. Importers, attorneys, consultants, and others generally prefer this option.
So, after more than 15 years and billions of dollars, has CBP delivered delivered a viable tool with ACE? I believe the answer is yes. There is some functionality yet to be delivered, including some that has not been migrated from ACS to ACE, but even the primary users of the system (customs brokers) only have a one-page punch list of outstanding issues. While I can and do complain to CBP about outstanding issues I find in ACE, as a taxpayer and an advanced user of ACE I must admit CBP delivered.
Going forward, CBP and the other participating government agencies must continue to upgrade ACE, deliver additional functionality, and learn to take advantage of the data available. For its part, the trade must learn to take advantage of ACE, including understanding how to interpret the information on their imports and exports. Both sides will share the responsibility of using ACE to effectively regulate imports and exports into the future.
Tom Gould is the senior director, customs and international trade, for Sandler Travis & Rosenberg, P.A., a licensed customs broker and certified customs specialist. Contact Gould at firstname.lastname@example.org