US CUSTOMS ACE SYSTEM
Earlier this year, US Customs began the roll out of ACE (Automated Commercial Environment), a platform meant to simplify the entry process by providing one "portal" to communicate all commercial data related to an import shipment. ACE is intended to replace the legacy ACS (Automated Commercial System) and ABI (Automated Broker Interface) systems. Within the near future, all US customs entries must be filed through the ACE portal. However, as this system roll out begins to gain traction, several issues have been uncovered. The most prominent thus far, has been the process for clearing containers that arrive via Canadian ports and are then railed to final destinations within the US.
What is the entry process for clearing import shipments?
US customs requires every import entry into the United States to identify the method with which the shipment was moved from origin to destination. Most imports into the US move via ocean (in containers on vessels) and are, as such, considered "ocean" shipments. US Customs will use information such as the vessel name from the ocean Bill of Lading for customs clearance.
How will the entry process for containers shipped to a Canadian port and railed to a final destination in the US differ?
Although shipments routed through Canadian ports initially begin their journey as "ocean" shipments, because they are entering the US via rail, US Customs considers the cargo to be a "rail" shipment and will use the following information from the rail Bill of Lading to file customs clearance;
-Rail Bill Number
Traditionally, the legacy systems allowed customs brokers to file a single entry on a rail Bill of Lading for multiple containers moving under one ocean Bill of Lading, regardless of whether or not they arrived on the same train. However, the roll out of ACE has mandated that brokers must now file separate entries for containers moving on different trains, even if they were initially booked under the same ocean Bill of Lading.
How will this affect my supply chain?
For example, your company has booked five containers under one ocean Bill of Lading to be imported from Shenzhen to Chicago via Vancouver. Previous to ACE, customs brokers would process one entry for all five containers to be cleared before reaching the rail ramp in Chicago (regardless of how many different trains the cargo was loaded onto). Now, let's assume your cargo does not get offloaded at the same time and those five containers are loaded onto 2 different trains. Customs brokers must now process 2 separate entries (one for each train) even though they were initially booked on one vessel, under one ocean Bill of Lading.
What does this mean?
Any of your shipments booked with multiple container's on one ocean Bill of Lading, moving through Canadian ports, but railed to a US final destination, may require separate entries if they are split between multiple trains. Therefore, each container will require its own commercial invoice and packing list.
What can you do moving forward?
Analyze your supply chain to identify situations where multiple containers are booked under one ocean Bill of Lading to Canadian ports with final destinations in the US.
For those shipments make sure you are able to provide commercial documentation for each container should brokers have to file multiple entries.
Consider limiting your Canadian routings to one container per Bill of Lading
Contemplate alternate routings
Should you have any questions regarding this update, please contact your Sales or Customer Service representative.