CSMS Message: 94-001185

THE CUSTOMS SERVICE IS IN THE PROCESS OF MODIFYING THE LINE
RELEASE SYSTEM. THE PROPOSED MODIFICATIONS HAVE BEEN
COMMUNICATED TO THE BORDER TRADE ALLIANCE, THE NORTHERN BORDER
BROKER'S ASSOCIATION, AND THE NATIONAL CUSTOMS BROKERS AND
FREIGHT FORWARDERS ASSOCIATION. THE MODIFICATIONS WERE ALSO
PRESENTED TO THE TRADE COMMUNITY AT MEETINGS HELD AT NINE MAJOR
PORTS OF ENTRY ALONG THE NORTHERN AND SOUTHERN BORDERS.

ONE KEY MODIFICATION WOULD LIMIT ALL APPROVED TRANSACTIONS, OR C4
CODES, TO A PRODUCT RANGE NO GREATER THAN THE HEADING LEVEL.
ANOTHER MODIFICATION WOULD REQUIRE EACH C4 CODE TO BE USED AT
LEAST FIFTY TIMES PER YEAR ACROSS ALL DISTRICTS WITHIN WHICH THE
CODE IS APPROVED. MANY MEMBERS OF THE IMPORTING COMMUNITY HAVE
EXPRESSED THE CONCERN THAT THESE MODIFICATIONS WILL HAVE A
TREMENDOUS IMPACT ON THE EXISTING PROCESS. SPECIFICALLY, THE
CONCERN HAS BEEN RAISED THAT THE NUMBER OF TRANSACTIONS ELIGIBLE
FOR CLEARANCE UNDER LINE RELEASE PROCEDURES WILL BE SIGNIFICANTLY
DECREASED BY NOT PERMITTING C4 CODES TO COVER MULTIPLE TARIFF
HEADINGS.

CUSTOMS HAS PERFORMED AN EXTENSIVE AMOUNT OF INTERNAL RESEARCH ON
THIS ISSUE, AND WE BELIEVE THAT THESE STANDARDS WILL IMPACT LINE
RELEASE VOLUME, BUT THAT ANY DECREASE WILL BE LESS THAN TEN
PERCENT NATIONALLY. MANY LINE RELEASE PARTICIPANTS HAVE ANALYZED
THE IMPACT OF THESE REQUIREMENTS ON THEIR BUSINESS. SEVERAL
MEMBERS OF THE TRADE COMMUNITY HAVE INDICATED THAT THEY WOULD
LIKE THE OPPORTUNITY TO FURTHER ASSESS THE IMPACT OF THESE
REQUIREMENTS ON THEIR CLIENTS.

IT IS CUSTOMS GOAL TO HAVE FULLY IMPLEMENTED THE PRODUCT RANGE
STANDARD BY APRIL 1, 1995. HOWEVER, IT IS RECOGNIZED THAT
ADDITIONAL RESEARCH EFFORTS BY THE TRADE COMMUNITY MAY INDICATE
THAT THE VOLUME IMPACT IS UNACCEPTABLE. IF IT IS DEMONSTRATED
THAT THESE STANDARDS WOULD REDUCE LINE RELEASE VOLUME BY MORE
THAN 25 PERCENT NATIONALLY, THEN THE PROPOSED MODIFICATIONS WILL
BE RECONSIDERED.

AS CUSTOMS BELIEVES THAT THE PRODUCT RANGE STANDARD WILL MOST
LIKELY BE IMPLEMENTED ON APRIL 1, 1995, IT IS NECESSARY TO MAKE
AN INTERIM CHANGE TO OUR APPLICATION APPROVAL PROCESS. EFFECTIVE
IMMEDIATELY, ANY NEW APPLICATIONS RECEIVED WHICH DO NOT MEET THE
PRODUCT RANGE STANDARD, WILL NOT BE APPROVED. IN OUR OPINION, IT
MAKES NO SENSE AT THIS TIME TO APPROVE A CODE AND THEN TURN
AROUND AND DISAPPROVE IT WITHIN THE NEXT FEW MONTHS.

THIS INTERIM CHANGE HAS NO EFFECT ON CODES ALREADY IN USE. IT IS
OUR INTENTION TO WORK WITH THE TRADE TO IDENTIFY THE BEST
MECHANISM TO MODIFY THE EXISTING DATABASE.

ONCE AGAIN, THIS IS AN INTERIM STEP ONLY, AND DEPENDING UPON THE
OUTCOME OF ANY FURTHER ANALYSIS BY CUSTOMS AND THE TRADE, THE
REQUIREMENT TO LIMIT A C4 CODE TO THE HEADING LEVEL MAY BE
WITHDRAWN. PLEASE REFER ANY QUESTIONS TO MR. LOU SAMENFINK OF
THE OFFICE OF FIELD OPERATIONS AT (202) 927-0510.