The Importer Security Filing (ISF), also known as “10+2”, is a U.S. Customs and Border Protection (CBP) regulation that requires importers and vessel operating carriers to provide advance shipment information to CBP for security purposes. This glossary aims to provide a comprehensive understanding of the terms and definitions associated with ISF filing, to help importers navigate the process more effectively.
The ISF data sheet is a critical document in the ISF filing process. It contains all the necessary information that must be submitted to CBP, including details about the importer, the goods being imported, and the shipping details. Understanding the terms and definitions used in the ISF data sheet is crucial for successful ISF filing.
ISF filing is the process of submitting the required advance shipment information to CBP. This information is submitted electronically, through the Automated Commercial Environment (ACE) system. The ISF must be filed at least 24 hours before the cargo is loaded onto the vessel at the foreign port.
The purpose of ISF filing is to enhance the security of U.S. borders. By providing CBP with advance information about the goods being imported, they can better assess the risk associated with each shipment and take appropriate action to ensure the security of the country.
The ISF Importer is the party responsible for ensuring that the ISF is filed correctly and on time. This is usually the goods’ owner, purchaser, consignee, or agent such as a licensed customs broker. The ISF Importer is also responsible for the accuracy of the information provided in the ISF.
It’s important to note that the ISF Importer may be different from the Importer of Record (IOR). The IOR is the entity responsible for ensuring that the goods comply with all U.S. laws and regulations, paying the assessed import duties and taxes, and maintaining all necessary records.
Bill of Lading
The Bill of Lading (BOL) is a document issued by a carrier to a shipper, acknowledging that specified goods have been received on board as cargo for conveyance to a named place for delivery to the consignee who is usually identified. In ISF filing, the BOL number is a critical piece of information that must be provided.
There are two types of BOLs that can be used in ISF filing: the Master BOL (MBOL) and the House BOL (HBOL). The MBOL is issued by the main carrier of the goods, while the HBOL is issued by a freight forwarder or Non-Vessel Operating Common Carrier (NVOCC).
ISF Data Elements
The ISF consists of 10 data elements that must be provided by the ISF Importer, and 2 data elements that must be provided by the carrier. These data elements provide detailed information about the shipment, including the description and classification of the goods, the parties involved in the transaction, and the routing of the shipment.
Each data element has specific requirements and must be accurately reported to avoid penalties. For example, the description of the goods must be precise enough to allow CBP to determine its proper classification, and the Importer of Record number must be the IRS number, Social Security number, or CBP assigned number of the entity liable for payment of all duties and responsible for meeting all statutory and regulatory requirements incurred as a result of importation.
Manufacturer (or Supplier)
The Manufacturer (or Supplier) data element refers to the last known entity by whom the goods were produced or grown, or if not known, the name and address of the supplier of the finished goods in the country from which the goods are leaving. This information is used by CBP to verify the origin of the goods and assess their risk level.
It’s important to note that the manufacturer or supplier must be a legal entity and cannot be a factory or a farm. Also, the address provided must be a physical address and cannot be a post office box.
Country of Origin
The Country of Origin data element refers to the country where the goods were produced or grown. This information is used by CBP to assess the risk associated with the goods, as some countries are considered higher risk than others.
The country of origin must be reported as a 2-letter ISO code. If the goods were produced or grown in more than one country, the country of origin is the country where the goods were substantially transformed into their final form.
ISF Enforcement and Penalties
CBP enforces the ISF requirements through a combination of reviews, audits, and penalties. If the ISF is not filed, filed late, or contains inaccurate information, the ISF Importer may be subject to penalties.
The penalty for a late or inaccurate ISF is typically $5,000 per violation, but can be as high as $10,000. In addition, CBP may hold the cargo at the port until the ISF is filed and all penalties are paid.
An ISF Bond is a type of surety bond that guarantees that the ISF Importer will comply with all ISF requirements. If the ISF Importer fails to comply, CBP can make a claim against the bond.
The ISF Bond is separate from the Entry Bond, which guarantees that the Importer of Record will comply with all U.S. laws and regulations related to the importation of goods. However, both bonds can be covered by a single Continuous Bond, which covers all of an importer’s transactions over a 12-month period.
ISF-5 is a simplified version of the ISF that is used for goods that are transiting through the U.S. but are not being entered into the U.S. commerce. ISF-5 requires fewer data elements than the full ISF, but still requires the filing of some key information such as the booking party and foreign port of unlading.
Like the full ISF, ISF-5 must be filed at least 24 hours before the cargo is loaded onto the vessel at the foreign port. Failure to file ISF-5 or filing inaccurate information can result in penalties.
Understanding the terms and definitions associated with ISF filing is crucial for importers to navigate the process effectively and avoid penalties. This glossary provides a comprehensive overview of these terms, but it’s always a good idea to consult with a licensed customs broker or other trade professional to ensure compliance with all ISF requirements.
Remember, the ISF is just one part of the import process. There are many other requirements and documents involved in importing goods into the U.S., and each one has its own set of terms and definitions that importers need to understand.