Quest News™

July 19, 2013

Important ISF Update


Avalon has received many questions from the trade on whether the ISF Submission Types 5 and 6 known as “ISF-10 LATE ISF-No Bond” options could still be used for the one-time importer or ocean shipment that arrives with no ISF on file. During this phase of enforcement, we have received confirmation from CBP HQ and can confirm the following:

  • CBP will continue to allow the submission type “ISF-10 LATE ISF-No Bond” to be used. 
  • ISF Filers would not be liable for any liquidated damage claims against the ISF in absence of a bond, unless they secure the ISF with their own bond and act as the ISF Importer of Record.
  • Liquidated damages cannot be issued against the ISF Importer of Record if there is no bond.
  • However, CBP HQ has advised that penalties could be issued against the ISF Importer of Record if these submission types are abused stating:  “If a given importer is seen by CBP to be abusing this option, CBP will enforce the ISF requirements through the assessment of additional penalties applicable under other provisions of the law. In the mitigation guidelines, you’ll find language that CBP may assess penalties against a party for ISF violations under 19 U.S.C. 1595a(b). These penalties are reserved for serious and repetitive violations.”

As a reminder, please refer to CBP’s FAQ that states the following regarding the usage of these ISF submission types:  “The usage of these ISF submission types is an explicit acknowledgement that the ISF requirements were not properly met” and these ISF submission types are meant for “one-time importers.”

Use of the ISF submission types 5 and 6 will also trigger a non-intrusive inspection (NII) or possibly full examination of the cargo that could be costly to the importer and should be weighed against the cost of bonding and potential for liquidated damage violations.  Since CBP can still issue a penalty against the ISF importer under 19 U.S.C. 1595a(b) for abusing these submission types, we encourage all ISF Filers to limit the usage as directed by CBP.

The best way to avoid costly inspections, examinations or liquidated damages is to ensure that ocean cargo is shipped with a timely, complete and accurate ISF and bond to secure the obligation for release of cargo and subsequent entry.  Please also note that CBP will be placing holds on cargo arriving in the U.S. without an ISF and will not process an entry for an ocean shipment until an ISF is filed.

Please review the LA Bulletin and the New York/Newark Pipeline 13-027-NWK that provides details on these cargo holds and how these ports will be handling ISF enforcement.  While we expect all CBP ports to use these same codes and practice for cargo holds uniformly, each port will have its own policy on how they will issue liquidated damages to ensure ISF compliance.  We encourage you to work with your local port for details.

You can register by clicking here for the next ISF webinar on Tuesday, July 23 at 1:00 PM EST.  We will also be hosting an NEI Webinar on Tuesday, August 13 at 1:00 PM EST and will be sending details under separate cover to register.

We will continue to keep you advised of any updates from CBP on ISF Enforcement.  Please view our ISF archives and CBP ISF website or send any technical ISF questions to security_filing_general@cbp.dhs.gov.  Please refer to our ISF Q&As and be sure to contact our ISF team for any bond-related or Web Merlin™ questions, our contact details are provided below:

For any ISF surety-related questions, please contact your local Avalon office or our Underwriting Department at bond-underwriting@avalonrisk.com or contact The ISF Hotline at (847) 700 - TISF. View a list of our offices here

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