CSMS Message: 97-000614

TO : ALL ABI BROKERS.

FROM : CONRAD L HENRY

SUBJECT : MIS- ACE NEWSLETTER VOL 1 # 5

DATE : 06/30/97

TRADE COMPLIANCE/ACE REDESIGN
PROJECT NEWSLETTER FOR THE TRADE COMMUNITY

VOLUME I, ISSUE 5, JUNE 27, 1997

NATAP UPDATE

THE NORTH AMERICAN TRADE AUTOMATION PROTOTYPE (NATAP) TEST PERIOD
IS SCHEDULED TO END ON SEPTEMBER 30, 1997. YET TO BE COMPLETED
ARE SEVERAL INFRASTRUCTURE INSTALLS, AND UPGRADES TO THE NATAP
NETWORK. A TRILATERAL EVALUATION WILL BE CONDUCTED DURING AND
AFTER THE TEST PERIOD. SO FAR, NATAP HAS DEMONSTRATED THE
ABILITY TO PRESENT PRIMARY BOOTH INSPECTORS WITH ADVISORY
INFORMATION ABOUT THE SHIPMENT BEING IMPORTED IN A FEW SECONDS.
SECONDARY EXAMS HAVE ALSO BEEN ACCOMPLISHED USING FULL COMMERCIAL
DATA FILED BY THE TRADE SECURELY VIA ENCRYPTED INTERNET
CONNECTIONS.

AUTO-TECH 97

THE AUTOMOTIVE INDUSTRY ACTION GROUP (AIAG) WILL HOLD ITS' ANNUAL
CONFERENCE AND EXHIBITION AUGUST 26-28, 1997 IN DETROIT,
MICHIGAN AT THE COBO CONFERENCE CENTER. U. S. CUSTOMS WILL
CONDUCT A PANEL DISCUSSION LED BY OIT ASSISTANT COMMISSIONER ED
KWAS ENTITLED 'TRADE AUTOMATION: MOVING TO THE 21ST CENTURY,'.
OST ASSISTANT COMMISSIONER, CHUCK WINWOOD, WILL PRESENT THE
OVERVIEW OF CUSTOMS EFFORTS TO STREAMLINE THE PROCESS FOR BOTH
CUSTOMS AND THE TRADE.

THE DISCUSSION WILL FOCUS ON THE IMPACT OF STATUTORY CHANGES SUCH
AS NAFTA AND MODACT, THE REDESIGNED TRADE COMPLIANCE PROCESS AND
THE NEW AUTOMATED COMMERCIAL ENVIRONMENT (ACE), AND THE FIRST
OPERATIONAL DEMONSTRATION OF THESE KNOWN AS THE NATIONAL CUSTOMS
AUTOMATION PROGRAM (NCAP) PROTOTYPE BEGINNING IN SEPTEMBER, 1997.
THE PANEL WILL INCLUDE KEVIN SMITH REPRESENTING GENERAL MOTORS
(IMPORTER), ROSEANNE ESPOSITO REPRESENTING EXPEDITERS
INTERNATIONAL (BROKER) , GINA ADDUCI REPRESENTING SCHNEIDER
NATIONAL (CARRIER) AND WES GROSE, TRADE COMPLIANCE PROCESS OWNER,
PORT OF DETROIT. EACH PANEL MEMBER WILL SHARE THE BUSINESS
PERSPECTIVE ON THEIR INVOLVEMENT IN THE PROTOTYPE.

TRADE COMPLIANCE REDESIGN/ACE DISPLAY AT HQ

THE TRADE COMPLIANCE REDESIGN/ACE BOOTH WAS SET UP IN THE LOBBY
OF CUSTOMS HEADQUARTERS IN JUNE. THE DISPLAY INCLUDED THE NCAP/P
MULTIMEDIA PRESENTATION WHICH WAS OFFERED TO YOU IN LAST MONTH'
S NEWSLETTER. TO DATE, MANY DISKETTES CONTAINING THE MULTIMEDIA
PRESENTATION HAVE BEEN REQUESTED BY CUSTOMS EMPLOYEES AND SENT
OUT, EITHER VIA MAIL OR CC:MAIL. THE FEEDBACK ON BOTH THE BOOTH
AND THE PRESENTATION HAS BEEN EXTREMELY POSITIVE..

OUTREACH ACTIVITIES

MS. ROSALYN MCLAUGHLIN-NELSON OF THE AUTOMATED COMMERCIAL
ENVIRONMENT (ACE) AND
MS. PAT MORRIS OF THE AUTOMATED EXPORT SYSTEM (AES) ARE PRESENTED
THEIR RESPECTIVE EXHIBITS AT THE 6TH ANNUAL INTERNATIONAL AIR
CARGO CONFERENCE HELD IN INDIANAPOLIS ON MAY 8-9, 1997.

SEVERAL MEMBERS OF THE TRADE COMPLIANCE REDESIGN/ACE DEVELOPMENT
TEAM GAVE PRESENTATIONS ON VARIOUS ASPECTS OF THE PROJECT AT THE
TRADE COMPLIANCE REDESIGN MEETING HELD AT THE WESTIN HOTEL,
HOUSTON, TEXAS, MAY 28-29, 1997. THIS CONFERENCE WAS SO
SUCCESSFUL, THE OFFICE OF FIELD OPERATIONS WILL SPONSOR A SECOND
CONFERENCE IN LAS VEGAS ON AUGUST 20-21, 1997.

ON JUNE 9, 1997 JANET PENCE AND SUSAN MASKELL TRAVELED TO SAN
FRANCISCO TO MEET WITH REPRESENTATIVES OF LEVI STRAUSS CO. TO
PRESENT INFORMATION AND DISCUSS THEIR PARTICIPATION IN THE NCAP
PROTOTYPE. LEVI IS ONE OF FIVE COMPANIES WHO APPLIED FOR
PARTICIPATION IN THE PROTOTYPE. THE NEWEST MEMBER OF THE LEVI
STAFF IS DARCY DAVIDSON, CUSTOMS COMPLIANCE, FORMERLY A MEMBER OF
THE CUSTOMS PROCESS ANALYSIS REQUIREMENTS TEAM UNDER BETSY
DURANT.

ON JUNE 11, 1997 REPRESENTATIVE FROM CUSTOMS AND THE TRADE MET TO
DISCUSS RECONCILIATION ISSUES APPLICABLE TO THE NCAP PROTOTYPE.
AMONG THE ISSUES DISCUSSED WERE: LIQUIDATION, PROTESTS, NAFTA
CLAIMS (INCLUDING FEES AND INTEREST), CLASSIFICATION, MATERIALITY
PARAMETERS ON VALUE, DRAWBACK, AND THE TIME FRAME FOR
RECONCILIATION PORTION OF NCAP/P.

ON JUNE 12, 1997 THE REGULAR MONTHLY MANAGEMENT MEETING OF
CUSTOMS AND TRADE PARTICIPANTS IN THE NCAP PROTOTYPE WAS HELD.
AMONG THE TOPICS DISCUSSED AT THIS MEETING WERE: A RECAP OF THE
WORKING GROUP MEETING HELD THE WEEK OF 6/2, THE PROPOSED BAR CODE
FORM FOR NCAP, THE CONSTRUCTION AT PORT HURON, AN UPDATE OF THE
COMMUNICATIONS SUBCOMMITTEE, TRADE COMMENTS ON THE EVALUATION
PLAN/DEPLOYMENT PLAN, WHETHER THE CUSCAR EDITS WILL BE AVAILABLE
TO THE TRADE, HOW APPLICATION ADDRESSES (UNB/UNG) WILL BE
HANDLED, AND THE IMPACT MULTIPLE ENTRY NUMBERS PER TRIP WILL HAVE
ON MPF.

EILEEN KASTAVA AND KATHY KORMOS WILL BRIEF ATTENDEES ABOUT NCAP
AT THE NATIONAL BORDER CARGO RELEASE CONFERENCE IN TUCSON,
ARIZONA, JUNE 24-26, 1997.

CUSTOMS SENIOR LEVEL MANAGEMENT WILL BRIEF ROBERT BOSCH
CORPORATION ON THE TRADE COMPLIANCE REDESIGN IN CHICAGO ON
WEDNESDAY, JULY 16, 1997. THE MEETING WILL BE ATTENDED BY ALL
DIVISIONS OF ROBERT BOSCH, INCLUDING THE AUTOMOTIVE GROUP, A
PARTICIPANT IN THE NCAP/P.

THE 2ND ANNUAL TREASURY IT CONFERENCE AND EXPOSITION WILL BE HELD
AT THE CAPITAL HILTON PRESIDENTIAL BALLROOM IN WASHINGTON, D.C.
ON WEDNESDAY, JULY 16 AND THURSDAY, JULY 17, 1997. THE TRADE
COMPLIANCE/ACE REDESIGN HAS BEEN SELECTED AS ONE OF THE
EXHIBITORS FOR THIS CONFERENCE.

TRAINING

A TWO-WEEK TRAINING COURSE WAS GIVEN TO THE 25 PERMANENT NATIONAL
ACCOUNT MANAGERS IN GLYNCO FROM MAY 27 - JUNE 6, 1997.
CONGRATULATIONS TO THE ATTENDEES!

TRAINING FOR THE CLIENT REPRESENTATIVES WHO WILL BE ASSISTING
PARTICIPANTS IN THE NCAP/PROTOTYPE IS TENTATIVELY SCHEDULED FOR
AUGUST 18-20, 1997 AT CUSTOMS HQ.

JOBS ARE CHANGING UNDER NCAP/P

ENTRY, IMPORT SPECIALISTS, INSPECTORS OAS FUNCTIONS

THERE WILL BE A NUMBER OF CHANGES IN THE WAY ALL CUSTOMS ENTRY,
IMPORT SPECIALISTS, INSPECTORS AND OAS PERSONNEL DO THEIR DAY-TO-
DAY WORK UNDER NCAP/P. FOR ENTRY PERSONNEL, A MAJOR CHANGE WILL
BE THE COLLECTIONS AND DEPOSITS FUNCTION. SINCE NCAP/P WILL BE
TESTING TRACK 4, THE FULLY ELECTRONIC DECLARATION TRACK FOR CARGO
RELEASE, ALL COLLECTIONS AND DEPOSITS WILL BE TRANSMITTED AND
PROCESSED ELECTRONICALLY VIA ACH CREDIT. THEREFORE, ENTRY
PERSONNEL WILL NOT HAVE TO COLLECT AND PROCESS CHECKS MANUALLY
FOR NCAP/P DECLARATIONS. A NEW PROGRAM CALLED VIOLATION BILLING
(VB) WILL ALSO AFFECT THE WAY ENTRY PERSONNEL DO THEIR WORK.
UNDER NCAP/P, THIS PROGRAM WILL PERMIT LATE FILES TO BE HANDLED
DIFFERENTLY. LATE FILES, A WELL AS OTHER PRE-IDENTIFIED
VIOLATIONS UNDER THE VB PROGRAM, ARE TREATED VIA A 30-DAY BILLING
PROCESS RATHER THAN THROUGH THE AUTOMATIC INITIATION OF
LIQUIDATED DAMAGES CLAIMS. ENTRY PERSONNEL WILL HAVE TO CLOSELY
MONITOR THE BILLS AND INITIATE THE LIQUIDATED DAMAGES CASES ONLY
IF THERE IS A DELINQUENCY. HOWEVER, SINCE NCAP/P PARTICIPATION
IS LIMITED, VERY FEW VIOLATION BILLS ARE ANTICIPATED BUT ACTIVITY
IS EXPECTED TO INCREASE SIGNIFICANTLY IN FUTURE RELEASES OF ACE.
OTHER ENTRY FUNCTIONS, SUCH AS LIQUIDATIONS, BONDS AND PROTESTS
WILL BE PERFORMED IN NCAP/P, BUT THEY WILL CONTINUE TO BE DONE
ESSENTIALLY THE SAME AS THEY ARE TODAY.

IMPORT SPECIALISTS WILL BE IMPACTED BY CHANGES IN THE WAY THEY
RECEIVE THEIR WORK. SPECIFICALLY, THEY WILL BE UTILIZING AN
ELECTRONIC IN-BOX. THIS IN-BOX IS GENERATED AS A RESULT OF THE
TARGETING SUB-SYSTEM GROUPING MULTIPLE DECLARATION LINES UNDER
ONE TYPE OF ISSUE AND ASSIGNING IT TO A WORKGROUP. A WORKGROUP
MAY BE COMPOSED OF MEMBERS LOCATED IN DIFFERENT PORTS. FOR
EXAMPLE, THE TARGETING SYSTEM WOULD SEND A WORKGROUP A WORK
ASSIGNMENT COMPOSED OF 20 LINES ALL RELATED TO AN ACCOUNT'S
CLASSIFICATION ISSUE. OR, AN ASSIGNMENT MAY BE MULTIPLE ACCOUNTS
POSSIBLY USING THE SAME MISCLASSIFICATION TO AVOID DUTY PAYMENT.

IMPORT SPECIALISTS WILL CONTINUE TO USE ANALYTICAL TOOLS SUCH AS
TAP AND THE NEW DATA WAREHOUSE TO GENERATE THEIR OWN REFERRALS.
THIS SUPPORTS THE NEW TRADE COMPLIANCE PROCESS FOR ACCOUNT
MANAGEMENT BY RE-ENFORCING TREND ANALYSIS FOR ACCOUNTS.

ANOTHER BIG CHANGE AHEAD FOR IMPORT SPECIALISTS WILL BE THE NCAP
RECONCILIATION PROTOTYPE. IF AN ACCOUNT DOESN'T HAVE ALL THE
INFORMATION IT NEEDS TO PROPERLY LIQUIDATE AN ENTRY, IT MAY FLAG
A LINE OR LINES AS A RECONCILIATION ISSUE (NAFTA, CLASSIFICATION,
VALUE, OR 9802). THE OTHER LINES OR INFORMATION NOT FLAGGED MAY
BE LIQUIDATED AS ENTERED. THE RECONCILIATION OF NAFTA ISSUES
MUST BE ELECTRONICALLY FILED WITHIN 12 MONTHS OF THE DATE OF
IMPORTATION OF THE "OLDEST" ENTRY WHICH IS FLAGGED. THE OTHER
THREE ISSUES HAVE 15 MONTHS. ENTRY PERSONNEL WILL ALSO BE
IMPACTED BY THE NEW RECONCILIATION PROCESS BECAUSE OF THEIR
CURRENT INVOLVEMENT IN THE PROCESSING OF NAFTA 520D CLAIMS.

OAS WILL BE LOOKING AT ACCOUNTS VERSUS TRANSACTIONS IN NCAP/P.
INSTEAD OF FOCUSING ON DISCREPANCIES, OAS WILL INITIALLY BE
MONITORING THE NCAP PROCESS FOR THEIR INDIVIDUAL PORTS. ONCE ACE
IS UP AND OPERATIONAL TO INCLUDE TARGETING OTHER THAN RANDOM
COMPLIANCE MEASUREMENT, OAS WILL USE THEIR ANALYTICAL
CAPABILITIES TO SELECT ONLY THOSE SHIPMENTS AND ENTRIES THAT
MIGHT PROVIDE A HIGHER LEVEL OF RISK FOR IMPORTATIONS INTO THE
COUNTRY.

AS FAR AS THE CHANGES THAT NCAP/P WILL BRING TO THE INSPECTORS,
PRIMARILY MORE
USE OF AUTOMATION, FACILITATION OF THE ENTRY AND RELEASE OF
CARGO. THERE WILL BE A
HUGE CULTURAL CHANGE IN THE ACCEPTANCE OF TRACK 4 RELEASES,
PRIMARILY BECAUSE OF THE
RELEASE OF MERCHANDISE WITH MINIMAL INFORMATION. THIS WILL BE
PARTICULARLY TRUE FOR SOUTHWEST
BORDER INSPECTORS BECAUSE OF THE HISTORY OF NARCOTICS IN THAT
AREA. HOW LONG WILL THE CULTURAL CHANGE TAKE? THIS IS HARD TO
SAY.