Rule2026-17390
Automated Commercial Environment (ACE) Electronic Export Manifest for Rail Cargo
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
August 26, 2026
Effective
October 26, 2026
Issuing agencies
Homeland Security DepartmentU.S. Customs and Border Protection
Abstract
U.S. Customs and Border Protection (CBP) is revising its regulations pursuant to the Trade Act of 2002 requiring the transmission of export manifest data electronically in the Automated Commercial Environment (ACE) for cargo transported by rail for any train departing the United States. This rule mandates the electronic transmission of rail export manifest information, identifies the parties eligible to transmit information, and describes the time frames prior to departure in which the information is due. This rule enables CBP to address important cargo security concerns while providing efficiencies to the trade.
Full Text
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<title>Federal Register, Volume 91 Issue 164 (Wednesday, August 26, 2026)</title>
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[Federal Register Volume 91, Number 164 (Wednesday, August 26, 2026)]
[Rules and Regulations]
[Pages 55170-55227]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-17390]
[[Page 55169]]
Vol. 91
Wednesday,
No. 164
August 26, 2026
Part II
Department of Homeland Security
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U.S. Customs and Border Protection
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19 CFR Parts 103, 113, 123, et al.
Automated Commercial Environment (ACE) Electronic Export Manifest for
Rail Cargo; Final Rule
Federal Register / Vol. 91, No. 164 / Wednesday, August 26, 2026 /
Rules and Regulations
[[Page 55170]]
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DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
19 CFR Parts 103, 113, 123, and 192
[Docket No. USCBP-2024-0030; CBP Dec. 26-15]
RIN 1651-AB52
Automated Commercial Environment (ACE) Electronic Export Manifest
for Rail Cargo
AGENCY: U.S. Customs and Border Protection, DHS.
ACTION: Final rule.
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SUMMARY: U.S. Customs and Border Protection (CBP) is revising its
regulations pursuant to the Trade Act of 2002 requiring the
transmission of export manifest data electronically in the Automated
Commercial Environment (ACE) for cargo transported by rail for any
train departing the United States. This rule mandates the electronic
transmission of rail export manifest information, identifies the
parties eligible to transmit information, and describes the time frames
prior to departure in which the information is due. This rule enables
CBP to address important cargo security concerns while providing
efficiencies to the trade.
DATES: Effective date: This rule is effective on October 26, 2026.
Compliance date: CBP will begin enforcing this rule on October 26,
2027.
FOR FURTHER INFORMATION CONTACT: David Garcia, Program Manager,
Outbound Enforcement and Policy Branch, Office of Field Operations,
CBP, via email at <a href="/cdn-cgi/l/email-protection#315253415449415e43455c505f5857544245715253411f5559421f565e47"><span class="__cf_email__" data-cfemail="e7848597829f978895938a86898e81829493a7848597c9838f94c9808891">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Executive Summary
A. Purpose of Revising the Regulations for Electronic Export Manifest
for Rail Cargo
Current regulations are insufficient to adequately capture cargo
data for rail shipments leaving the United States. U.S. Customs and
Border Protection (CBP) is finalizing this rule to reduce the data gaps
existing under current regulations, and to address important cargo
security concerns resulting from incomplete data. This rule will apply
to all rail cargo exports and provide efficiencies to the trade. CBP
does not presently require the pre-departure electronic transmission of
data for all exported cargo as it does for imported cargo. This can
result in a threat to cargo and broader U.S. national security because
CBP has no regulations prescribing any method or means of review for
cargo being exported by rail. The electronically transmitted cargo data
that is transmitted prior to departing the United States by rail is
limited significantly in its scope. Currently, 19 CFR 192.14 requires a
U.S. Principal Party in Interest (USPPI), the USPPI's agent, or the
authorized filing agent of a Foreign Principal Party in Interest (FPPI)
to transmit Electronic Export Information (EEI) to CBP through the
Automated Commercial Environment (ACE). While this pre-departure data
is helpful, EEI is generally only required by the Bureau of Census
regulations on shipments that exceed $2,500, per Schedule B number and
is generally not required for shipments to Canada unless certain
controlled items are involved or the shipment is being transshipped to
another destination. 15 CFR Parts 30 and 758. Because of these
limitations, there is a significant lack of electronic manifest data
which inhibits the enforcement efforts by CBP for such exports. This
rule creates an integrated pre-departure electronic export manifest
which includes receiving advance information for risk assessment
purposes from the source most likely to have correct information about
the cargo. This rule closes the gap which currently exists and requires
all information to be manifested which enhances the security of the
rail cargo and aligns the security of exported rail cargo with the
regulations that are required of rail cargo imported into the United
States.
B. Statutory Authority
Pursuant to Section 343(a) of the Trade Act of 2002, as amended
(``Trade Act'') (19 U.S.C. 1415), CBP is authorized to promulgate
regulations providing for the mandatory transmission of electronic
cargo information by way of a CBP-authorized electronic data
interchange (EDI) system before cargo arrives or departs the United
States by any mode of commercial transportation (sea, air, rail, or
truck). The required cargo information is reasonably necessary to
ensure cargo safety and security pursuant to the laws enforced and
administered by CBP. 19 U.S.C. 1415(a)(2)). CBP needs to obtain timely
and sufficient data prior to cargo arriving or departing the United
States via any mode of commercial transportation to review and conduct
risk assessments to identify high-risk shipments and inspect cargo
effectively.
C. Summary of the Rule
This rule mandates the transmission of electronic export manifest
(EEM) data, in addition to the EEI data required under 15 CFR part 30,
for all cargo prior to departing the United States for Canada and
Mexico in the rail environment in lieu of paper submissions. The new
regulation, to be codified at 19 CFR 123.93, mandates the electronic
transmission of rail export manifest information, identifies the
parties eligible to transmit such information, describes the time
frames prior to departure of the train in which the information is due,
requires a bond to secure compliance with the new regulation, and
identifies an initial filing that must occur as early as practicable,
but no later than 24 hours prior to departure from the U.S. port of
export while requiring the remaining data to be transmitted at least
two hours prior to such departure. The new regulation designates
information as transportation data, cargo data, or empty container
data, and lists the data elements to be transmitted while identifying
and classifying them as mandatory, conditional, or optional. The data
elements identified as mandatory must be transmitted, while elements
identified as conditional shall be transmitted if applicable, and
optional elements may be transmitted at the discretion of the party
making the transmission. These data elements will allow CBP to inspect
cargo effectively, ensure compliance with U.S. export control laws and
regulations, and identify high-risk shipments for purposes of ensuring
cargo safety and security.
In the notice of proposed rulemaking (NPRM), 90 FR 2874, 2917 (Jan.
13, 2025), CBP proposed that the initial filing ``must be transmitted
as early as practicable, but no later than 24 hours prior to departure
of the train from the United States.'' Subsequent filings were due ``no
later than two hours prior to departure of the train from the United
States.'' Id. In this final rule, consistent with the NPRM preamble and
to provide greater clarity regarding these deadlines, CBP has revised
the regulatory text such that the 24-hour and 2-hour deadlines are
keyed to the ``departure of the train from the United States port of
export,'' rather than simply ``departure of the train from the United
States.'' \1\ This change is intended to make explicit that
[[Page 55171]]
the operative deadline is the train's scheduled departure from the
designated U.S. port of export and to avoid any ambiguity regarding
inland rail yards or other locations.
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\1\ See, e.g., 90 FR at 2880 (``The proposed regulation would .
. . identify an initial filing that must occur 24 hours prior to
departure from the port of export while requiring the remaining data
to be transmitted at least two hours prior to such departure.''
(emphases added)).
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Also in the NPRM, CBP proposed to add 19 CFR 123.93(c), which
identifies the parties that can transmit the cargo and conveyance data.
The outbound carrier is responsible for transmitting the export
manifest transportation data and empty container data. If no other
party elects to transmit the initial filing data and the export
manifest cargo data, then the outbound carrier must transmit this data.
If another eligible party elects to transmit either the initial filing
data or export manifest cargo data, the outbound carrier may also
choose to, but is not required to, transmit such data. Other eligible
parties include the USPPI and FPPI, or an authorized agent, as those
parties are defined in section 30.1 of the Federal Trade Regulations
(FTR) of the Department of Commerce, Bureau of the Census (15 CFR
30.1). Other eligible transmitters also include any other party with
direct knowledge of the export information, such as a customs broker,
Automated Broker Interface (ABI) filer, Non-Vessel Operating Common
Carrier (NVOCC) as defined by 19 CFR 4.7(b)(3)(ii), or a freight
forwarder as defined in 19 CFR 112.1. If another party does not
transmit advance export information, then the party that arranges for
and/or delivers the cargo to the outbound carrier must fully disclose
and present to the outbound carrier the data elements for the initial
filing. Based on the comments received after the publication of the
NPRM regarding certain parties such as freight forwarders or NVOCCs,
CBP is amending 19 CFR 123.93(c) to reflect that these parties will not
be acting as customs brokers but, in this instance, acting as EEM
transmitters. Specifically, in section 123.93(a), CBP is adding a
provision stating that ``[t]he transmission of such EEM data for the
purpose of complying with this section does not constitute customs
business.''
Section 123.93(d) requires a mandatory initial filing of seven data
elements identified below to be transmitted as early as practicable,
but no later than 24 hours prior to departure from the United States,
by either the carrier, USPPI, or another qualified party or their
authorized agent. The results of the Test have shown that some rail
carriers would have the export manifest data available days in advance
prior to departure and therefore would have all the necessary
information to transmit the initial filing data to CBP and all other
export manifest data well in advance of the 24-hour prior to departure
deadlines.\2\ Except for the initial data elements, CBP would require
electronic export manifest information in sections 123.93(e), and (f)
to be transmitted two hours prior to train departure from the U.S. port
of export.
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\2\ The results of the rail EEM test are discussed in further
detail under Section VII below.
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Based upon comments submitted, CBP is making the following changes
in paragraphs (d), (e), and (f) as compared to the NPRM:
<bullet> In paragraphs (d)(1)(v) and (vi) (which were paragraphs
123.93(d)(5) and (6) in the NPRM), CBP is removing the identification
number from these data elements to remove any potential uncertainty and
to provide CBP with the necessary information that is sought.
<bullet> In paragraph (d)(2), CBP is revising its approach to
exemption statements. This revision introduces a conditional element to
be transmitted with the initial filing at the time of the initial
filing, or as soon as the information becomes applicable: the Automated
Export System (AES) Internal Transaction Number (ITN) or FTR exemption/
exclusion code. (As proposed, there was a mandatory data element for
``Automated Export System (AES) Exemption Statement, as applicable.'')
Making this data element conditional will allow the filer to complete
the initial EEM filing even when the ITN or FTR exemption/exclusion
code is not yet available.
<bullet> In paragraph (d)(1)(vii), and in paragraphs (e), and (f),
CBP now includes a new data element, ``Employer Identification Number
(EIN) or Importer Record Number (IRN) or CBP assigned number,'' that
will help CBP identify the transmitter's required bond, which will be
obligated to secure the filing, and will be a mandatory data element
for the initial filing, transportation data filing, and cargo data
filing. CBP will determine the obligated bond as follows: if the
transmitter has an active international carrier bond, the transmitter's
international carrier bond will be obligated to secure the filing; if
the transmitter does not have an active international carrier bond but
does have an active basic custodial bond, the transmitter's basic
custodial bond will be obligated to secure the filing; and if the
transmitter has neither an active international carrier bond nor an
active basic custodial bond but does have an active basic importation
and entry bond, the transmitter's basic importation and entry bond will
be obligated to secure the filing.
Section 123.93(g) provides for two types of referrals that may be
issued by CBP after a risk assessment of an outbound export manifest
data transmission. Should any rail cargo be identified by CBP as
requiring review, the cargo will not depart until the required
additional information related to the shipment is transmitted or some
other appropriate action is taken, as specified by CBP. Once the cargo
is cleared for loading, a release message will be generated and
transmitted to the filer. Section 123.93(h) provides for additional
procedures for when a CBP officer determines during the review that
cargo or a rail car may contain a potential threat to the train and its
vicinity, so that a Do-Not-Load (DNL) instruction can be issued. A DNL
instruction prohibits the rail carrier from transporting that cargo or
rail car so that further examination can be conducted. These
examinations allow CBP to secure the cargo, conduct risk assessments,
and inspect cargo effectively. CBP is changing paragraph (h), as
compared to the NPRM, by:
<bullet> Making clear that DNL and Hold instructions are issued
``to the outbound rail carrier and any other transmitter as soon as
applicable''; and
<bullet> Providing that ``[a]ll outbound rail carriers and
transmitters who receive a DNL or Hold instruction must contact CBP at
the port of export.''
As an enforcement tool, CBP is also changing the relevant bond
provisions in 19 CFR 113.62 (basic importation and entry bond), 19 CFR
113.63 (basic custodial bond), and 19 CFR 113.64 (international carrier
bond) to provide CBP with authority to assess liquidated damages when
parties do not provide the mandatory EEM data in the manner and in the
time frame required. Specifically, CBP is amending 19 CFR 113.62 to add
new paragraph (k)(3), and amending 19 CFR 113.63(g) and 19 CFR
113.64(d), to add new parameters for failure to electronically provide
outbound information in the manner and time frame required because
these provisions currently address electronic transmissions for
merchandise or cargo which is inbound. With each of these regulations,
CBP may assess liquidated damages if a violation occurs. CBP's primary
goal is compliance and CBP seeks to work alongside rail carriers and
other parties to ensure that the proper data is provided in a timely
manner, for CBP to properly review the data, conduct risk assessment of
high-risk shipments, and enforce U.S. export laws and regulations on
U.S. rail exports. As compared to the NPRM, CBP is also changing
proposed 19 CFR 113.64(d)(1) by removing the references to ``Sec. Sec.
4.7 and 4.7(a) of this chapter'' and changing the language to read
``applicable regulations'' so that CBP can rely on this
[[Page 55172]]
regulation to enforce violations in other modes of transportation
without further amendment. Similarly, in sections 113.62(k)(3),
113.63(g)(2), and 113.64(d)(1) and (2), CBP is removing the references
to ``under Sec. 123.93 of this chapter'' and changing the language to
read ``by regulation'' so that CBP can rely on those regulations to
enforce violations in other modes of transportation without further
amendment. This final rule will also require a party transmitting the
EEM data to CBP to have an appropriate bond on file with CBP that
contains the condition to transmit advance export information in the
manner required by regulation. This rule goes into effect 60 days after
publication, but CBP will not begin enforcing this rule until one year
after publication, which gives a party expecting to need an appropriate
bond when CBP begins enforcing this rule 300 days to obtain such a
bond, either by terminating and replacing an existing continuous bond
or by obtaining a new bond (continuous or single transaction). At one
year, a bond that does not contain the condition to transmit advance
export information in the manner required by regulation will be deemed
insufficient.
For CBP, this requirement to transmit an electronic export manifest
will enhance cargo security because it provides improvements in risk
assessment capabilities by allowing CBP to use its Automated Targeting
System (ATS) to screen all of the data transmitted. Port operations
will enjoy considerable efficiencies through the elimination of paper
manifests. Storage space currently reserved for manifest documents will
be freed. Coordination and information exchange among CBP, the
Department of Commerce, and other partner government agencies with
export jurisdiction will improve. Carriers, USPPIs, NVOCCs, and other
interested parties who transmit information will receive more thorough
and rapid examination decisions from CBP and improved communication
between CBP and trade members. The trade will benefit through the ease
of making information corrections and additions electronically in
contrast to the more time-consuming process that is required with paper
submissions. These benefits, including improved targeting capabilities,
which are necessary for security purposes, outweigh the flexibility of
allowing parties to file submissions either by paper or electronically.
CBP has also made a couple of other conforming changes as compared
to the NPRM. First, CBP is amending Sec. 192.14(b)(1)(iv) to clarify
that, for rail cargo, Electronic Export Information (EEI) included in
an initial data transmission of electronic export manifest (EEM)
information must be filed in accordance with the provisions of Sec.
123.93. This change aligns the EEI filing requirements for rail exports
with the new electronic export manifest procedures. The purpose of the
change is to avoid any potential conflict or confusion regarding the
applicable filing deadlines.
Second, as compared to the NPRM, CBP is making a clarifying change
to Sec. 103.31a(a) to add a reference to Sec. 123.93. Specifically,
CBP is listing advance electronic information for outbound rail cargo
submitted under the new electronic export manifest requirements as
information that is covered by the availability of information
provisions in Sec. 103.31a.
D. Costs and Benefits
CBP anticipates that during the time period of analysis, including
the Test period and the regulatory period (2016-2030), this final rule
will result in costs, cost savings, and benefits to CBP and trade
members engaging in exporting merchandise out of the United States in
the rail environment.\3\ CBP estimates present value total costs to CBP
and trade members will range from $10.3 million (discounted 2025 U.S.
dollars) using a three percent discount rate to around $7.0 million
(discounted 2025 U.S. dollars) using a seven percent discount rate. The
annualized total costs are estimated to range from $859,845 using a
three percent discount rate to around $764,026 using a seven percent
discount rate. CBP identified some other potential costs from this rule
and some comments from the public voiced concerns about these costs but
did not provide monetized values for costs to trade members. Therefore,
CBP was unable to monetize these costs, including time burdens to CBP
officers if the final rule results in additional cargo examinations and
costs to trade members participating in the rail EEM from adjusting
business practices, requiring participants to hold or obtain an
appropriate bond, requiring outbound rail carriers to have staff
available to respond to CBP questions, and trade members potentially
being liable for liquidated damages for any violations. Present value
total cost savings to CBP and trade members are expected to range
between around $47.7 million (discounted 2025 U.S. dollars) using a
three percent discount rate, and $29.6 million (discounted 2025 U.S.
dollars) using a seven percent discount rate. Annualized cost savings
are estimated to range from $4.0 million using a three percent discount
rate and $3.3 million using a seven percent discount rate. CBP expects
that there will be additional cost savings to trade members that CBP
was unable to monetize such as reduced paper, printing and storage
costs related to paper forms, and reducing or eliminating instances
where trains need to be deconstructed in order for CBP to examine cargo
that typically results in a delay of up to two hours and around $3,000
in freight movement costs. CBP anticipates that benefits from this
final rule will include improving CBP's security efforts by using ATS
to conduct risk assessments on all rail exports, improving
communication between federal agencies with export jurisdiction, and
improving efficiencies to participating trade members from
transitioning from a paper to an electronic process. However, CBP was
unable to monetize the expected benefits from this final rule. Present
value total net cost savings from the implementation of this final rule
will range from $37.5 million (discounted 2025 U.S. dollars) using a
three percent discount rate and $22.7 million (discounted 2025 U.S.
dollars) using a seven percent discount rate. Annualized net cost
savings from this final rule are expected to range from $3.1 million
using a three percent discount rate to $2.5 million using a seven
percent discount rate.\4\ Table 1 below displays CBP's estimates for
annualized costs, cost savings, benefits, and net costs from this final
rule using a three and seven percent discount rate over the period of
analysis (2016-2030). Additionally, based on CBP's perpetual time
horizon calculations, the present value of net cost savings from this
final rule will be $128.6 million and the annualized value of net cost
savings will be $9.01 million using a seven percent discount.
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\3\ In the Regulatory Impact Analysis for this final rule, CBP
also discusses and provides estimates for the costs, cost savings,
and benefits compared to the baseline (prior to the introduction of
the rail EEM test) during both the rail EEM test pilot period (2016-
2025) and for the regulatory period (2026-2030).
\4\ In the economic analysis for this final rule, CBP used a
three and seven percent discount rate for estimated future
quantified and monetized costs, cost savings, and benefits based on
guidance from OMB Circular A-4.
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II. Statutory Authority
Section 343(a) of the Trade Act (19 U.S.C. 1415) authorizes CBP to
promulgate regulations providing for the mandatory transmission of
electronic cargo information by way of a CBP-authorized EDI system
before the cargo is brought into or departs the United States by any
mode of commercial transportation (sea, air, rail, or truck). The
required cargo information is reasonably necessary to enable CBP to
ensure cargo safety and security pursuant to the laws enforced and
administered by CBP. 19 U.S.C. 1415(a)(2).
CBP consulted with carriers throughout the process of developing
the proposed regulation and during the course of the ACE Export
Manifest for Rail Cargo Test that has been administered since 2015. 19
U.S.C. 1415(a)(3)(A). As the statute requires, in general, the
regulation imposes requirements on the party most likely to have direct
knowledge of information to be provided. When requiring information
from the party with direct knowledge of that information is not
practicable, the regulations take into account how, under ordinary
commercial practices, information is acquired by the party on which the
requirement is imposed, and whether and how such party is able to
verify the information. Where information is not reasonably verifiable
by the party on which a requirement is imposed, the regulations permit
that party to transmit information on the basis of what it reasonably
believes to be true. 19 U.S.C. 1415(a)(3)(B). The regulation that CBP
is promulgating will require the transmission of the export manifest
data electronically in ACE for cargo transported by rail, pursuant to
section 343(a), of the Trade Act. 19 U.S.C. 1415(a)(3)(E). Under
section 343(a)(3)(G) of the Trade Act (19 U.S.C. 1415(a)(3)(G)), CBP is
required to promulgate regulations that protect the privacy of business
proprietary and any other confidential cargo information provided to
CBP. Data electronically presented to CBP in accordance with 19 CFR
123.93 is specifically exempt from disclosure as either trade secrets
or privileged or confidential commercial or financial information under
19 CFR 103.31a, unless CBP receives a specific request for such records
pursuant to 6 CFR 5.3, and the owner of the information expressly
agrees in writing to its release. The regulations avoid imposing
requirements that are redundant with one another or that are redundant
with requirements in other provisions of law, as seen below. 19 U.S.C.
1415(a)(3)(I).
III. Background
A. Current Regulations
Under the existing regulations, commercial rail carriers are not
required to submit a paper or electronic manifest for cargo exported
from the United States by rail. CBP does have regulations which support
the transmission of EEI required by the Bureau of the Census Foreign
Trade Regulations (FTR) or the Bureau of Industry and Security's Export
Administration Regulations (EAR). Section 192.14 of title 19 of the
Code of Federal Regulations implements the requirements of the Trade
Act regarding cargo departing the United States. Under 19 CFR 192.14,
the USPPI, or its authorized agent, or the authorized filing agent of
the FPPI is required to transmit certain advance information to CBP for
export cargo leaving the United States by rail.\5\
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\5\ The USPPI is defined in the Bureau of the Census FTR as the
person or legal entity in the United States that receives the
primary benefit, monetary or otherwise, from the export transaction.
Generally, that person or entity is the U.S. seller, manufacturer,
or order party, or the foreign entity while in the United States
when purchasing or obtaining the goods for export. 15 CFR 30.1.
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Under 19 CFR 192.14, the USPPI or its authorized agent must
transmit and verify system acceptance of this EEI, generally no later
than two hours prior to the arrival of the train at the border. See 19
CFR 192.14(b)(1)(iv). A commercial rail carrier may not load cargo
without first receiving from the USPPI or its authorized agent either
the related EEI filing citation, covering all cargo for which the EEI
is required, or exemption legends, covering cargo for which EEI need
not be filed. See 19 CFR 192.14(c)(4)(i). While the rail carrier is not
required to transmit a rail cargo export manifest to CBP, the outbound
rail carrier must annotate the carrier's outward manifest, waybill, or
other export documentation with the applicable AES proof of filing,
post departure, downtime, exclusion, or exemption citations, conforming
to the approved data formats found in the Bureau of the Census FTR. See
15 CFR part 30.
The current regulations found in 19 CFR 192.14 also require the
USPPI, the USPPI's authorized agent, or the authorized filing agent of
the FPPI to electronically transmit to CBP through AES certain EEI.
This information supports statistical gathering; however, it falls
short of addressing important cargo security considerations because
almost all shipments with a value less than $2,500.00 per Schedule B
number and shipments directed to Canada are exempt from EEI filing
requirements, other than, for example, those containing certain items
controlled under the EAR or intended for transshipment through Canada,
creating a gap in security which this new regulation will resolve by
requiring information on all exports for rail cargo. CBP will require
the transmission of manifest information, providing CBP the opportunity
to more effectively target all shipments that are exported by rail,
which will increase CBP's ability to discover and interdict contraband
such as narcotics, weapons, or ammunition, thereby enhancing the
security of the United States. This new regulation will close the
security gap by requiring compliance with the regulation in order to
export the cargo as parties will have to provide pre-departure
electronic manifest information which CBP can screen and inspect for
the safety and security of the United States and its neighboring
countries. This new regulation also aligns with the current regulation
for rail cargo imported into the United States. See 19 CFR 123.91.
The transmission of EEI is a Bureau of the Census filing regulated
by 15 CFR part 30 and, with few exceptions, is only submitted when the
value of merchandise is above $2,500.00 per Schedule B commodity
classification number. See, e.g., 15 CFR 30.1(c) (definition of
``shipment''), 30.37(a).
The requirement to transmit EEI also does not apply to rail
shipments bound for Canada, unless such shipments contain certain
export-controlled items or are destined for transshipment to third
countries. See 15 CFR 30.36. This regulatory gap leaves many shipments
outside of CBP security review. The lack of pre-departure information,
which includes commodity information submitted by rail carriers into
CBP targeting systems, hinders CBP's ability to conduct risk
assessments and inspect cargo effectively to ensure cargo safety and
security. This new regulation creates an integrated pre-departure
electronic export manifest which includes receiving advance information
for risk assessment purposes from the source most likely to have
correct information about the cargo.
Currently, for exporting purposes, each carrier submits a train
consist in a format that the carrier develops and with the data
elements that the carrier believes should be reported. The train
consist identifies what is on the train, the order of the train, and
what the train is consisted of as it prepares to depart the country.
These data elements provide export information similar to that required
by the provisions of 19
[[Page 55175]]
CFR 123.91, which describes electronic information for rail cargo
required in advance of arrival, and 19 CFR 123.6, which includes a
train sheet for arriving railroad trains.
B. The ACE Export Manifest for Rail Cargo Test
On September 9, 2015, CBP published a general notice in the Federal
Register (80 FR 54305) announcing the National Customs Automation
Program (NCAP) Test for the transmission through ACE of EEM information
for rail shipments, the ACE Export Manifest for Rail Cargo Test
(``Test''), which was limited to nine rail carriers.
In part, the Test was used in furtherance of International Trade
Data System (ITDS) key initiatives, set forth in section 405 of the
Security and Accountability for Every Port Act of 2006, Public Law 109-
347, 120 Stat. 1884, 1929-1931 (SAFE Port Act), codified at 19 U.S.C.
1411(d), and Executive Order 13659, Streamlining the Export/Import
Process for America's Businesses, 79 FR 10655 (Feb. 25, 2014). The
purpose of ITDS, as stated in section 411(d)(1)(B) of the SAFE Port
Act, is to eliminate redundant information requirements, efficiently
regulate the flow of commerce, and effectively enforce laws and
regulations relating to international trade, by establishing a single
portal system operated by CBP for the collection and distribution of
standard electronic import and export data required by all
participating federal agencies. ACE was developed by CBP as the
``single window'' for the trade community to comply with the ITDS
requirement established by the SAFE Port Act. See 19 U.S.C.
1411(d)(1)(B).
The data elements in the original Test have been mandatory unless
otherwise indicated below. The Test has required that the five
conditional data elements be transmitted to CBP only if the particular
information pertains to the shipment or cargo. The data elements are
required to be transmitted at the lowest bill level. The data elements
in the Test for all shipments, including empty rail cars, consist of:
(1) Mode of Transportation (containerized rail cargo or non-
containerized rail cargo)
(2) Port of Departure from the United States
(3) Date of Departure
(4) Manifest Number
(5) Train Number
(6) Rail Car Order
(7) Car Locator Message
(8) Hazmat Indicator (Yes/No)
(9) 6-character Hazmat Code (conditional) (If the hazmat indicator is
yes, then UN (for United Nations Number) or NA (North American Number)
and the corresponding 4-digit identification number assigned to the
hazardous material must be provided.)
(10) Marks and Numbers
(11) SCAC (Standard Carrier Alpha Code) for exporting carrier
(12) Shipper name and address (For empty rail cars, the shipper may be
the railroad from whom the rail carrier received the empty rail car to
transport.)
(13) Consignee name and address (For empty rail cars, the consignee may
be the railroad to whom the rail carrier is transporting the empty rail
car.)
(14) Place where the rail carrier takes possession of the cargo
shipment or empty rail car
(15) Port of Unlading
(16) Country of Ultimate Destination
(17) Equipment Type Code
(18) Container Number(s) (for containerized shipments) or Rail Car
Number(s) (for all other shipments)
(19) Empty Indicator (Yes/No)
If the empty indicator is no, then the following data elements must
also be provided, as applicable:
(20) Bill of Lading Numbers (Master and House)
(21) Bill of Lading Type (Master, House, Simple, or Sub)
(22) Number of House Bills of Lading
(23) Notify Party name and address (conditional)
(24) AES Internal Transaction Number or AES Exemption Statement (per
shipment)
(25) Cargo Description
(26) Weight of Cargo (may be expressed in either pounds or kilograms)
(27) Quantity of Cargo and Unit of Measure
(28) Seal Number
(29) Split Shipment Indicator (Yes/No)
(30) Portion of split shipment (e.g., 1 of 10, 4 of 10, 5 of 10--Final,
etc.) (conditional)
(31) In-bond Number (conditional)
(32) Mexican Pedimento Number (only for shipments for export to Mexico)
(conditional)
On August 14, 2017, CBP extended the Test and began accepting
additional applications for all parties that met the eligibility
requirements of the original nine stakeholders composed of rail
carriers. (82 FR 37893). CBP consulted with the Commercial Customs
Operations Advisory Committee (COAC) to address issues concerning the
quality, accessibility, and timeliness of export manifest data received
during the Test.
After evaluating the initial phase of the Test and considering
COAC's comments, CBP determined that, to better test the functionality
and feasibility of transmitting the specified export data two hours
prior to loading of the cargo on the train, the filing condition for
nine of the data elements should be changed. The modified filing
conditions enabled CBP to better determine the appropriate reporting
requirements for each data element.
CBP modified the Test to change the following eight mandatory or
conditional data elements to optional:
<bullet> Mode of Transportation (containerized rail cargo or non-
containerized rail cargo) (Data Element #1)
<bullet> Place where the carrier took possession (Data Element #14)
<bullet> Country of Ultimate Destination (Data Element #16)
<bullet> Equipment Type Code (Data Element #17)
<bullet> Number of House Bills of Lading (Data Element #22)
<bullet> Split Shipment Indicator (Data Element #29)
<bullet> Portion of Split Shipment (Data Element #30)
<bullet> Mexican Pedimento Number (Data Element #32)
CBP also modified the Test to change Data Element #10, Marks and
Numbers, from mandatory to conditional.
The remaining data elements under the extended Test continued to be
mandatory, conditional, or optional as provided in the September 9,
2015 notice.
CBP identified in the expansion and modification of the Test that
it would reevaluate the filing conditions for each data element to
determine the feasibility of requiring that data element to be filed
electronically in ACE within a specified timeframe before the cargo is
loaded on the train, should CBP decide to conduct rulemaking.
Accordingly, this regulation changes the timing of presentation of most
electronic export manifest data from two hours prior to loading on the
train to two hours prior to departure of the train from the U.S. port
of export.
Since its inception, the Test evaluated the practicality of
requiring rail carriers to transmit export manifest data in a
standardized format by utilizing ACE ITDS initiatives. A key challenge
was that CBP had not yet established regulations for the specific data
elements needed, and carriers were providing train manifests in their
own chosen formats. ACE resulted in the creation of a single automated
export processing platform for certain export manifest, commodity,
licensing, export control, and export targeting transactions.
Transmitting export
[[Page 55176]]
manifest data through ACE reduces costs for CBP, partner government
agencies, and the trade community, and improves facilitation of export
shipments through the supply chain.
Additionally, the Test examined the feasibility of requiring the
rail carrier to transmit manifest information electronically in ACE,
generally within a specified timeframe before the cargo has been loaded
on the train. Test participants were required to transmit export
manifest data electronically to ACE at least two hours prior to loading
of the cargo or, for empty rail cars, upon assembly of the train. This
time frame enabled CBP to link the EEI transmitted by the USPPI with
the export manifest information. Much of that success resulted from the
fact that a high percentage of information is transmitted well before
the deadline of two hours prior to departure. CBP found that nearly 94
percent of data transmissions occurred more than 24 hours prior to
conveyance departure.\6\
---------------------------------------------------------------------------
\6\ Information provided by CBP's Cargo and Conveyance Security,
Office of Field Operations, subject matter expert on May 9, and June
21, 2022. CBP conducted a random sample of train conveyances
participating in the rail EEM test and found that around 94 percent
of data transmissions were submitted 24 hours prior to departure.
---------------------------------------------------------------------------
The success of the Test allowed CBP to determine that the
electronic transmission of manifests provides improvements in
capabilities at the departure level. As a result of these improvements,
CBP is now codifying this program with the regulations in this
document. Upon the effective date of this rule, the ACE Export Manifest
for Rail Cargo Test will end.
IV. Purpose and Need of the Rule
On January 13, 2025, CBP published a notice of proposed rulemaking
which proposed a new regulatory requirement because there are no
regulations in place requiring the submission of an electronic export
manifest for cargo transported by rail to assess cargo security. 90 FR
2874. The regulatory changes are the culmination of CBP's efforts with
the Test described above in Section III.
This regulation leverages the data elements and train consist
requirements in advance of departure to Mexico and Canada in order for
CBP to make the best use of the data. The data elements are already
included in the current Test, which has been operational since
September 9, 2015. 80 FR 54305. This regulation identifies the
mandatory, conditional, and optional data elements and who is required
to transmit the data. The regulation also adds seven mandatory data
elements to be provided and presented as the initial filing as early as
practicable, but no later than 24 hours prior to departure of the train
and one conditional data element to be presented as soon as it is
available.
For CBP, the requirement to transmit an electronic export manifest
will enhance cargo security because it improves risk assessment
capabilities at the port level. Port operations will enjoy considerable
efficiencies through the elimination of paper manifests. Storage space
currently reserved for manifest documents will be freed. Coordination
and information exchange among CBP, the Department of Commerce, and
other partner government agencies with export jurisdiction will
improve. Carriers, USPPIs, NVOCCs, and other interested parties who
transmit information will receive more thorough and rapid examination
decisions from CBP. The trade will benefit through the ease of making
information corrections and additions electronically, a process that
requires cumbersome manifest discrepancy reporting in a paper world.
CBP uses the ACE Export Manifest data transmission, for instance,
to conduct risk assessments to identify high-risk rail cargo, but even
for this purpose, ``high risk'' is not limited to weapons, ammunition,
currency or narcotics. High-risk shipments are identified based on the
totality of the review which includes the party name, country of
destination, cargo description, and/or a combination of data elements.
Data supports the conclusion that Test participants have access to the
manifest data early in the planning stages of an export rail cargo
transaction and are able to comply with these time frames. Where
concerns were revealed through comments received after the NPRM was
published, CBP adjusted certain factors required to be included within
the initial filing. CBP added a conditional data element to the
regulation, previously a mandatory element, the AES Exemption
statement, and amended it to, AES ITN or FTR exemption/exclusion code
based on the comment that filers may not have such information to meet
the initial filing requirement at the 24-hour mark. CBP recognized that
this was a distinct possibility and therefore amended the regulation in
this final rule. As stated, CBP anticipates that these timeframes will
provide adequate time to perform proper risk assessments and
identification of shipments to be inspected early enough in the supply
chain to enhance security while minimizing disruption to the flow of
goods. Current regulations do not provide any method to screen or
secure rail cargo exports, which this regulation seeks to address. ACE
Export Manifest pre-departure data transmission allows CBP to use its
ATS to screen all of the data transmitted, which allows CBP to make
better examination decisions while also reducing the time required to
make such decisions. Although CBP aims to identify shipments for
inspection prior to loading, inspections could potentially happen at
any time before the train departs the United States.
Any rail cargo identified by CBP as requiring review will be held
until the required additional information related to the shipment is
transmitted to clarify non-descriptive, inaccurate, or insufficient
information, a physical inspection is performed, or some other
appropriate action is taken, as specified by CBP. Once the cargo is
cleared for loading, a release message will be generated and
transmitted to the filer.
V. Discussion of Final Rule
CBP is promulgating a new regulation, 19 CFR 123.93, requiring the
transmission of export manifest data electronically in ACE for cargo
transported by rail, pursuant to section 343(a) of the Trade Act. The
regulation mandates the electronic transmission of rail export manifest
information, identifies the parties eligible to transmit information,
describes the time frames prior to departure of the train in which the
information is due, requires a bond to secure compliance with the new
regulation, and identifies an initial filing that must occur as early
as practicable, but no later than 24 hours prior to departure from the
U.S. port of export while requiring the remaining data to be
transmitted at least two hours prior to such departure.
Further, consistent with section 343 of the Trade Act, this new
regulation requires parties with the most direct knowledge to provide
certain information to CBP. In furtherance of that goal, the regulatory
language sets forth differences between transportation data (always
required of the carrier and carrier only) and cargo data, which can be
provided by the party with direct knowledge of that information.
Consistent with the provisions of 19 U.S.C. 1415(a)(3)(B), when
requiring information from the party with direct knowledge of the
information is not practicable, the regulation takes into account how,
under ordinary commercial practices, information is acquired by the
party on which the requirement is imposed and whether and how such
party is able to verify the information. Where information is not
reasonably verifiable by the party, the regulation permits the party to
transmit
[[Page 55177]]
information on the basis of what it reasonably believes to be true.
The regulation designates information as transportation data, cargo
data, or empty container data, and lists the data elements to be
transmitted while identifying them as mandatory, conditional, or
optional. The data elements that are identified as mandatory must be
transmitted. These elements are necessary for CBP to inspect cargo
effectively, ensure compliance with U.S. export control laws and
regulations, and identify high-risk shipments for purposes of ensuring
cargo safety and security. Data elements that are identified as
conditional must be provided if applicable. Data elements identified as
optional provide additional information for purposes of clarity and may
facilitate the clearance process but are not required to be
transmitted.
The regulation provides direction regarding enforcement referrals,
DNL messages, and Hold messages. Any rail cargo identified by CBP as
requiring review will be held until the required additional information
related to the shipment is transmitted to clarify non-descriptive,
inaccurate, or insufficient information, a physical inspection is
performed, or some other appropriate action is taken, as specified by
CBP. If the cargo is cleared for loading, a release message will be
generated and transmitted to the filer(s). If a potential high-risk
cargo is identified, then a CBP officer will conduct an examination.
The rail carriers, and any other filers, will be notified of these
holds through the integrated system if a mandatory examination of the
cargo and/or freight car is required or if CBP needs to conduct further
review of the data transmitted. In addition to holds, if a CBP officer
determines during review that cargo or a rail car may contain a
potential threat to the train and its vicinity, a DNL instruction will
be issued, which prohibits the rail carrier from transporting that
cargo or railcar. The rail carrier should not transport any cargo or
rail car with a DNL instruction. The advance transmission of EEM data
helps CBP review and issue holds before cargo is loaded, or before a
train reaches the U.S. port of export, thus facilitating a more
efficient export process.
Specifically, CBP is requiring seven data elements, characterized
as an initial filing, to be transmitted as early as practicable, but no
later than 24 hours prior to train departure. As a result of comments
received, CBP amended the initial filing to include an AES ITN or FTR
exemption/exclusion code as a conditional element recognizing that such
information may not be available to the filer at the 24-hour mark.
Because compliance is CBP's goal, CBP changed this data element to be
conditional and must be transmitted as soon as it is available. CBP
replaced the seventh original data element with EIN or IRN or CBP
assigned number which was another suggestion based upon comments
received from the NPRM. Recognizing that there is more than one type of
bond that may be used to secure legal compliance, it is important that
CBP records the party transmitting the information to verify that that
party has at least one of the required bonds on file. Therefore, CBP
added this requirement as the seventh initial data element as well as a
mandatory element within transportation and cargo data. The seven data
elements chosen for mandatory transmission at least 24 hours prior to
departure are those data elements that provide CBP with the cargo
information it needs to perform the appropriate security analysis,
including: Bill of Lading Number, Total Quantity, Total Weight, Cargo
Description, Shipper's name and address, Consignee name and address,
and EIN or IRN or CBP assigned number. The AES ITN or FTR Exemption/
Exclusion Statement, which is another security-based data element, is
another conditional data element to be supplied if and when it is
obtained by the filer.
The rule provides for the transmission of transportation,
conveyance, and empty container information two hours prior to
departure of the train rather than two hours prior to loading (or on
assembly of the train in the case of information pertinent to empty
rail cars). This change in transmission timing for all other data
elements combined with the initial transmission affords CBP the ability
to better assess risk and effectively target and inspect shipments
prior to the cargo departing the United States to ensure cargo safety
and security.
A. Eligible Parties
Section 123.93(c) identifies the parties that can file the cargo
and conveyance data. The outbound carrier is responsible for
transmitting export manifest transportation data and empty container
data. The outbound carrier must also transmit the initial filing data
and the export manifest cargo data if no other eligible party elects to
do so. If another eligible party elects to transmit either the initial
filing data or export manifest cargo data, the outbound carrier may
also choose to, but is not required to, transmit such data. Other
eligible parties include the USPPI and FPPI, as defined by the
provisions of section 30.1 of the FTR of the Department of Commerce,
Bureau of the Census (15 CFR 30.1), or its authorized agent. Other
eligible filers also include any other party with direct knowledge of
the export information, such as a customs broker, ABI filer, NVOCC as
defined by 19 CFR 4.7(b)(3)(ii), or a freight forwarder as defined in
19 CFR 112.1. Based upon comments received, CBP changed proposed 19 CFR
123.93(a) to clarify that filing EEM data does not constitute customs
business, as defined in 19 U.S.C. 1641(a)(2). If another party does not
transmit advance export information, then the party that arranges for
and/or delivers the cargo to the outbound carrier must fully disclose
and present to the outbound carrier the data elements for the initial
filing. Any party transmitting any of the data described in sections
123.93(d)-(f) must have on file with CBP either a CBP basic importation
and entry bond containing the provisions found in 19 CFR 113.62, a
basic custodial bond containing the provisions found in 19 CFR 113.63,
or an international carrier bond containing the provisions found in 19
CFR 113.64.
B. Initial Data Elements
Different from the Test's time periods for data presentation, 19
CFR 123.93 requires a mandatory initial filing of seven data elements
identified below to be transmitted as early as practicable, but no
later than 24 hours prior to departure from the U.S. port of export, by
either the carrier, USPPI, or other qualified parties or their
authorized agents. As reflected in 19 CFR 123.93(b)(1), CBP determined
that requiring this initial filing in the time frame prescribed is
necessary to allow for complete vetting of cargo and transportation
information for security purposes. The high percentage of data
available for transmission 24 hours prior to departure supports the
feasibility of requiring this initial filing. In further support of
this approach, CBP intends to relax validations that relate to
transportation data until the carrier links the master bill and house
bill to allow for the transmission of advance data. Upon receipt of the
initial filing transmission, CBP will validate and notify the filer of
the master bill and house bill data, if any data is required, or if the
house bill has been placed on hold pending the updating of the bill.
Under the new regulation, the carrier will have the ultimate
responsibility to load, hold, or not load the cargo. The carrier,
USPPIs, and other parties qualified to transmit data (or their
authorized agent) will be eligible to transmit the initial data filing
as discussed above.
[[Page 55178]]
CBP added 19 CFR 123.93(d) which identifies the seven data elements
from the Test that are required in the mandatory initial filing.
Descriptions of those data elements were revised in the proposed rule
to clarify the kind and character of data that is required. The revised
data elements have been further amended based upon comments received
from the NPRM for the initial filing to identify the party transmitting
the information and provide for additional time in the situation where
an AES ITN or FTR exemption/exclusion code are not available at the 24-
hour mark. Below are the data elements with the Test data elements to
which they correspond in brackets:
(1) Bill of lading number, which is necessary to link the
transmission to the cargo throughout the entire electronic manifest
process;
(2) The numbers and quantities of the cargo laden aboard the train
as contained in the carrier's bill of lading, either master or house,
as applicable (this means the quantity of the lowest external packaging
unit; numbers or quantities of containers and pallets do not constitute
acceptable information; for example, a container holding 10 pallets
with 200 cartons should be described as 200 cartons) [Test data element
of Quantity of Cargo and Unit of Measure];
(3) Total weight of cargo expressed in pounds or kilograms [Test
data element of Weight of Cargo (may be expressed in either pounds or
kilograms)];
(4) A precise cargo description (or the Harmonized Tariff Schedule
(HTSUS) number(s) to the 6-digit level under which the cargo is
classified if that information is received from the shipper and weight
of the cargo; or for a sealed container, the shipper's declared
description and weight of the cargo (generic descriptions, specifically
those such as ``FAK'' (freight of all kinds), ``general cargo'', and
``STC'' (said to contain) are not acceptable)) [Test data element of
Cargo Description];
(5) The shipper's complete name and address, or identification
number, from the bills of lading (for each house bill in a consolidated
shipment) [Test data element of Shipper name and address];
(6) The consignee's complete name and address, or identification
number, from the bill(s) of lading. (The consignee is the party to whom
the cargo will be delivered in a foreign country. However, in the case
of cargo shipped ``to order of [a named party],'' the ``to order''
party must be named as the consignee; and if there is any other
commercial party listed in the bill of lading for delivery or contact
purposes, the carrier must also report this other commercial party's
identity and contact information including address in the ``Notify
party'' field.) [Test data element of Consignee name and address];
(7) EIN or IRN or CBP assigned number. [Data element recommended by
commenter]; and
Conditional data. The following initial data is conditional and
must be transmitted if and as soon as applicable. The AES ITN or FTR
exemption/exclusion code. [Test data element of AES Exemption Statement
(per shipment)].
Except for these eight data elements described above, CBP requires
electronic export manifest information in sections 123.93(e), and (f)
to be transmitted two hours prior to train departure from the U.S. port
of export. That data comprises all additional data elements required to
be described as export manifest transportation data, cargo data, and
empty container data.
C. Transportation Data Elements
Section 123.93(e)(1) establishes the obligation on the carrier or
its agent to supply transportation data. The transportation data
elements carried forward from the Test to the current rule include the
following:
(1) Port of Departure from the United States (mandatory);
(2) Date of Departure (mandatory);
(3) Mode of Transportation (containerized rail cargo or non-
containerized rail cargo) (optional);
(4) Equipment Type Code (optional);
(5) Place where the rail carrier takes possession of the cargo
shipment or empty rail car (optional);
(6) Carrier-assigned conveyance name, equipment number and trip
number (mandatory);
(7) 6-character Hazmat Code. (If the Hazmat Code is provided, then
UN (for United Nations Number) or NA (North American Number) and the
corresponding 4-digit identification number assigned to the hazardous
material must be provided.) (conditional);
(8) Marks and Numbers (conditional);
(9) SCAC (Standard Carrier Alpha Code) for the exporting carrier
(mandatory);
(10) Container or Equipment Numbers (for containerized shipments)
or Rail Car Numbers (for all other shipments) (mandatory);
A transportation data element carried over from the Test to section
123.3(e) with an expanded definition is as follows:
Seal Number (conditional, only required if container was sealed).
The seal numbers for all seals affixed to containers and/or rail cars
to the extent that CBP's data system can accept this information (for
example, if a container has more than two seals, and only two seal
numbers can be accepted through the system per container, electronic
presentation of two of these seal numbers for the container would be
considered as constituting full compliance with this data element).
In 19 CFR 123.93(e), CBP added the transportation data element of
``Estimated Time of Departure'' (mandatory) to be supplied by the
carrier or its agent that was not required in the Test but provides
important information to CBP.
Based upon comments received from the NPRM, CBP clarifies that 19
CFR 123.93(e)(1)(ii), date of departure, means the date that the train
crosses the international border.
Final 19 CFR 123.93(e)(1)(v), which adds the mandatory
transportation data element of ``Train Consist,'' provides CBP with
what is on the train from the engine through the last car and how the
cargo is lined up for departure from the United States. The Train
Consist is composed of the following data elements that were required
in the Test and remain in the regulation:
(1) Manifest Number
(2) Train Number
(3) Rail car order
(4) Empty containers.
D. Cargo Data Elements
Section 123.93(f) establishes the obligation to transmit manifest
cargo data by any eligible party or its agent identified in section
(c). The cargo data elements carried forward from the Test to the rule
in addition to the seven data elements forming the initial data filing
include the eighteen data elements listed below. CBP recognizes that
some cargo data elements are already requested in the initial data
filing; however, those data elements would not need to be transmitted
again unless there are updates or changes made. While a comment was
received asking about the deadline for updating information, CBP has
chosen not to insert a deadline as the most relevant and updated
information will always be sought. The final cargo data elements are as
follows:
(1) Shipper name and address (for empty rail cars, the shipper may
be the railroad from whom the rail carrier received the empty rail car
to transport) (mandatory);
(2) Consignee name and address (for empty rail cars, the consignee
may be the railroad to whom the rail carrier is transporting the empty
rail car) (mandatory);
(3) Port of Lading (mandatory);
[[Page 55179]]
(4) Port of Unlading (mandatory);
(5) Bill of Lading Type (Master, House, Simple, or Sub)
(mandatory);
(6) Bill of Lading Numbers (Master, House, Simple, or Sub)
(mandatory);
(7) AES ITN or In-bond Number (per shipment) (mandatory);
(8) Cargo description (mandatory);
(9) Weight of cargo (may be expressed in either pounds or
kilograms) (mandatory);
(10) Quantity of cargo and unit of measure (mandatory);
(11) Employer Identification Number (EIN) or Importer Record Number
or CBP assigned number (mandatory)
(12) In-bond type (conditional);
(13) Notify party name and address (conditional);
(14) Secondary notify party name and address (conditional);
(15) Mexican Pedimento Number (only for shipments for export to
Mexico) (optional);
(16) Secondary notify party SCAC (optional);
(17) Country of ultimate destination (optional); and
(18) Number of house bills of lading (optional).
E. Examination Referrals
Two types of referrals may be issued by CBP after a risk assessment
of an outbound export manifest data transmission, pursuant to 19 CFR
123.93(g). A referral for information will be delivered to the data
transmitter, the last party to file the outbound rail manifest data for
which referral is sought, if the information provided fails to
appropriately describe the cargo or if the information provided is
inaccurate or insufficient. The data transmitter must then add or
correct the information prior to the departure of the train from the
United States. A referral for screening will be issued if the potential
risk of the cargo is deemed high enough to warrant enhanced screening.
In this instance, the rail carrier is notified of these holds, and the
notification lets the rail carrier know that a mandatory examination of
the cargo and or freight car is required or if CBP needs to conduct
further review of the data transmitted.
F. Do-Not-Load (DNL)/Hold Instructions
CBP is also adding 19 CFR 123.93(h), which provides procedures for
when a CBP officer determines during the review that cargo or a rail
car may contain a potential threat to the train and its vicinity, so
that a DNL instruction can be issued, which prohibits the rail carrier
from transporting that cargo or rail car. The rail carrier should not
transport any cargo or rail car with a DNL instruction. A Hold
instruction will be issued, even after loading, if further examination
is required. In order to address such issues, data transmitters must
respond and fully cooperate when such an instruction or hold is issued.
Based upon comments received in the NPRM, CBP removed the requirement
that telephone numbers and email addresses be provided because the
system will electronically and automatically transmit to the rail
carrier and any other transmitter. CBP has changed section
123.93(h)(1)-(3) to clarify that if there is any other filer, in
addition to the rail carrier, all filers will be notified
electronically of such an issue. It is incumbent upon all parties who
receive a DNL/Hold instruction to contact CBP at the port of export.
G. Other Technical Amendments to Part 123
Because CBP is adding new subpart J, CBP is revising the scope
provision of the new regulation (19 CFR 123.0) to reflect that customs
procedures at the Canadian and Mexican borders would include electronic
information for cargo in advance of departure which is not addressed in
the current regulation.
H. Proposed Amendments to CBP Bond Conditions
As an enforcement tool, CBP is also changing the relevant bond
provisions in 19 CFR 113.62 (basic importation and entry bond), 19 CFR
113.63 (basic custodial bond), and 19 CFR 113.64 (international carrier
bond) to provide CBP with authority to assess liquidated damages when
parties do not provide the mandatory EEM data in the manner and in the
time frame required. Specifically, CBP amends 19 CFR 113.62 to add new
paragraph (k)(3) to address electronically provided outbound
information. Section 113.62(k) currently addresses electronic
transmissions for merchandise or cargo which is inbound. CBP also
amends 19 CFR 113.63(g) to include reference to advance outbound
information provided to CBP electronically and in the manner and in the
time period required under 19 CFR 123.93. Finally, CBP amends 19 CFR
113.64(d) to include outbound reference to information provided
electronically by international carriers in the manner and time period
required under 19 CFR 123.93. CBP has amended certain language in
section 113.64(d) so that CBP can rely on that section to enforce
violations in other modes of transportation without further amendment
in the future. CBP is not amending section 113.64(e) because that
provision, as already promulgated, provides for enforcement of
violations when advance outbound information is not provided to CBP
electronically and in the manner and in the time period required under
19 CFR 123.93. With each of these regulations, CBP may assess
liquidated damages if a violation occurs. Any party that violates the
bond conditions for outbound data transmission as described above in
this final rule agrees to pay liquidated damages of $5,000 for each
violation and up to a maximum of $100,000 per departure. CBP notes that
the $100,000 per departure cap on liquidated damages applies only to
international carrier bonds (19 CFR 113.64), and not to basic
importation and entry bonds (113.62) or basic custodial bonds (113.63).
This distinction reflects longstanding regulatory practice and is based
on the different types of obligations secured by each bond.
International carrier bonds secure obligations related to the movement
of conveyances, such as trains, vessels, or aircraft, and the cap is
intended to limit liability for each discrete movement. In contrast,
basic importation and entry bonds and basic custodial bonds secure
obligations that may involve the full value of imported merchandise or
the custody and control of goods, where no per-movement cap is
appropriate. Compliance is CBP's goal and CBP aspires to work alongside
rail carriers and other parties to ensure that trade members provide
the proper data in a timely manner, so that CBP can properly review the
data, conduct risk assessment of high-risk shipments, and enforce U.S.
export laws and regulations on U.S. rail exports. Consistent with this
approach, CBP will begin enforcing this rule on October 26, 2027.
I. Severability
CBP intends for the requirements contained in this rule to be
severable from each other and to be given effect to the maximum extent
possible, such that if a court holds that any provision is invalid or
unenforceable--whether in their entirety or as to a particular entity
or circumstance--the other provisions will remain in effect as to any
other person or circumstance.\7\ The various requirements in this final
rule are designed to function sensibly without the others, and CBP
intends for them to be severable so that each can operate
independently.
---------------------------------------------------------------------------
\7\ Courts have uniformly held that the APA, 5 U.S.C. 706(2),
authorizes courts to sever and set aside ``only the offending parts
of the rule.'' Carlson v. Postal Regulatory Comm'n, 938 F.3d 337,
351 (D.C. Cir. 2019); see, e.g., K Mart Corp. v. Cartier, Inc., 486
U.S. 281, 294 (1988).
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[[Page 55180]]
For example, CBP would intend to be able to implement as much of
the rule as possible, even if it could not implement some of the rule
(such as a conditional data element) due to a court order. This
approach ensures that CBP can make necessary security improvements to
the greatest extent possible.
Even if a court order were to render the requirement to transmit a
particular data element invalid or unenforceable and EEM transmitters'
responses under that data element inform transmitters' responsibilities
to transmit other data elements, CBP would intend that EEM transmitters
continue to provide the other data elements, using the preamble of this
final rule as guidance for the applicability of any conditions to the
extent this conditionality interpretation does not violate a court
order.
If a stricken provision creates a question of whether or not a
conditional data element should be transmitted, CBP intends that EEM
transmitters would interpret the stricken provision as satisfied such
that transmission of the conditional data element is required.
VI. Discussion of Comments
A. Overview
In response to the NPRM, CBP received eleven comments during the
60-day public comment period. Commenters consisted of individuals,
customs brokers and freight forwarders associations, standards and
compliance organizations, and trade associations. CBP reviewed the
public comments received in response to the rulemaking and has
addressed relevant comments in this final rule. CBP's responses are
grouped by subject area, with a focus on the most common issues and
suggestions raised by commenters. Some commenters expressed support for
the rule and strongly support CBP's efforts to move forward with the
NPRM because it modernizes and helps automate processes, enabling both
trade members and CBP to generate efficiencies in international trade.
These comments also offered suggestions for additional clarity and
improvement. While some commenters expressed general opposition to the
proposed rule citing significant costs, voicing concerns with potential
disruptions to trade flows, bonding requirements, lack of clarity on
certain details, ability to meet certain data reporting requirements
and unnecessary added costs, these commenters also provided some
suggestions for improvement. One commenter strongly opposed the NPRM
and suggested revisions to reduce the impact on its trade members.
Comments submitted regarding any topic other than the proposed rule,
(i.e., comments on topics unrelated to, for instance, EEM data,
process, and costs and benefits of the EEM) are out of scope for this
rule and were not considered.
B. Discussion of Comments
1. Generally Supportive With Suggested Changes/Improvements
Comment: One commenter provided suggested revisions to the
regulation text for section 113.63 and multiple paragraphs within
section 123.93(a), (c), (g), and (h) to simplify the language and
improve clarity.
Response: CBP appreciates the comment, but considers the language
used to be clear and concise, and therefore CBP is not making the
suggested edits.
Comment: One commenter who was supportive of the rule suggested
that CBP should offer financial or technical assistance to small and
medium sized rail carriers who are likely to face difficulties in
adopting new digital infrastructure.
Response: CBP appreciates the positive feedback. Additionally, CBP
plans to provide compliance resources and technical assistance to all
interested parties, including rail carriers, during the transition to
providing EEM data to CBP.
Comment: A few commenters requested that CBP ensure that the rail
manifest process aligns with the ocean manifest process, particularly
in determining the data element used to connect an NVOCC's submission
to the rail or ocean manifest.
Response: CBP agrees with the comment and states that CBP strives
to align the EEM process to the extent feasible for all modes of
transportation which are the subject of separate rulemakings.
Comment: One commenter suggested that CBP align the proposed rule
with internationally recognized standards, particularly those related
to the use of the commenter's suggested identifiers for tracking and
identifying cargo. The commenter cited ``GS1 identifiers (e.g., Global
Trade Item Numbers [GTINs] and Serial Shipping Container Codes [SSCCs])
for tracking and identifying cargo'' (brackets are the commenter's).
The commenter wrote that these globally unique identifiers are widely
used across the industry and can be leveraged to support enhancing data
accuracy, interoperability and efficiency. The commenter added that
``GS1 data carriers (e.g., GS1-128 barcodes and RFID tags) and GS1
standards for data sharing (e.g., EDI/XML, EPCIS) can be utilized'' and
that use of such standards ``would ensure harmonization with global
trade systems and enhances interoperability, ultimately reducing costs
and paperwork while improving operational efficiency for all
stakeholders involved in the export process including, but not limited
to, rail carriers and exporters.''
Response: CBP appreciates this comment and CBP's goal is to align
with recognized standards, but CBP believes its use of the Automated
Commercial Environment (ACE) as the platform for the electronic export
manifest and specific data elements, which are internationally
recognized, meets the standards being utilized by other trade systems.
Comment: One commenter supportive of the rule requested that CBP
adopt data quality standards that ensure that all required information
is provided in an accurate and timely manner, thus reducing the
potential for costly delays and non-compliance issues.
Response: CBP agrees and notes that as shown in the NPRM and this
final rule, CBP has adopted standards which provide the best
information in an orderly and accurate manner.
Comment: A number of commenters request that CBP allow sufficient
time and a transition period for trade members to prepare for full
implementation, specifically for them to adjust business practices and
adjust their systems such that they can provide the EEM data to CBP.
Response: CBP understands the concerns from these comments and in
response will make this rule effective 60 days after the date of
publication; however, enforcement will not begin for at least one year
to allow the trade members a period of transition so they may prepare
for full implementation. Additionally, CBP notes that its primary goal
is compliance and seeks to work alongside rail carriers and other
parties to ensure that the proper data is provided in a timely manner,
for CBP to properly review the data, conduct risk assessment of high-
risk shipments, and enforce U.S. export laws and regulations on U.S.
rail exports.
2. Issues With Eligible Parties
Comment: A number of commenters expressed concern about the
specific list of parties eligible to participate in the rail EEM,
specifically commenters stated that the USPPI, FPPI, customs brokers
and ABI filers were not likely to be EEM filers. Some of the commenters
suggested that CBP should remove references to the FTR except in
instances where the EEM filing must connect with the EEI filing. These
[[Page 55181]]
commenters reasoned that because reporting requirements under the FTR
are different, distinguishing between FTR requirements and EEM
requirements is important to avoid confusion about who is responsible
for the EEM filing.
Response: CBP emphasizes that the regulatory language describes who
is eligible to file and does not gauge whether the eligible filers will
or will not engage in this data transmission activity. Any of these
parties could be the party that has direct knowledge of the
information, and the regulation will not exclude them from eligibility.
CBP has added language to section 123.93(a) to clarify that the act of
transmitting EEM is not customs business, but brokers will still be
eligible to file EEM. Because USPPIs and FPPIs may be filers, the FTR
language will stay in this rule.
Comment: One commenter, who was generally supportive of the rule,
asked for additional clarity on which parties are responsible for
filing export manifest cargo data, specifically whether each of the
NVOCCs with house bills are required to file EEM data or only the
lowest level house bill filer must do so.
Response: CBP has afforded the export filers choices as to whether
to take responsibility over the transmission of data pertaining to a
shipment. While the outbound rail carrier is the default transmitter,
other parties may step forward and take responsibility for data
transmission. CBP only seeks a party with knowledge of the shipment to
be the transmitter; any eligible party may transmit the data. In any
situation, CBP encourages the party with the most direct knowledge of
the cargo to provide accurate and complete cargo data either directly
to CBP as an EEM participant or to another party that will act as the
EEM participant.
3. Availability of Filing Parties
Comment: A number of commenters were concerned about the
requirement that the EEM ``transmitter'' must have 24/7 access to the
phone number and email address provided on the EEM transmission. They
suggest that the rail carrier should be the entity required to monitor
a phone and email address 24/7, not the house-level filers. One
commenter specifically suggested that the house-level filers need not
have the same level of availability to CBP as the rail carriers.
Response: CBP understands the concern of the commenters and is
adjusting the language of the regulatory text in sections 123.93(h)(1)
through 123.93(h)(3) as part of this final rule to reflect this
concern. All parties who transmit EEM data will be notified, should an
instruction of Do-Not Load (DNL) or Hold be issued. CBP will update the
regulatory text to include all transmitters and/or outbound rail
carriers, as applicable, must respond and fully cooperate when a DNL or
Hold instruction is issued. The parties that receive such instructions
must contact CBP at the port of export. The party with physical
possession of the cargo will be required to carry out the DNL or Hold
protocols and the directions provided by law enforcement authorities.
It is incumbent on the parties who have received a DNL or Hold
instruction to contact CBP at the port of export.
4. Data Changes
Comment: Several commenters requested further guidance on section
123.93(b)(3). In the NPRM, CBP states that updates are required ``upon
discovery of data changes,'' but it does not specify a timeframe for
when such updates must be made. The comments recommend that CBP should
provide further guidance on whether there is a cutoff period for
updates, particularly in cases where discrepancies are identified long
after departure, such as during an audit conducted after delivery,
perhaps after a year or more.
Response: CBP appreciates this comment, but CBP sees value in
allowing trade members to update export manifest data at any time in
the future, which is consistent with CBP treatment of import manifest
data. This approach is similar to Foreign Trade Regulations at 15 CFR
part 30 which also seek updates without time constraints. Specifically,
under those regulations, ``corrections, cancellations, or amendments to
. . . information shall be electronically identified and transmitted .
. . for all required fields as soon as possible.'' 15 CFR 30.9(a).
5. Bond Conditions
Comment: A few commenters were concerned with proposed section
113.62 (k)(3) which states ``If the principal elects to provide advance
outbound information to CBP electronically, the principal agrees to
provide such information in the manner and in the time period required
under section 123.93 of this chapter. If the principal defaults with
regard to these obligations, the principal and surety (jointly and
severally) agree to pay liquidated damages of $5,000 for each
violation.'' These commenters recommend that this be removed as the
basic importation and entry bond is not applicable to the parties who
will be transmitting EEM filings.
Response: CBP believes that this recommendation is inconsistent
with the statutory provisions governing the transmission of advance
electronic cargo information. The information can come from a party
with direct knowledge of that information, who may be the principal on
a basic importation and entry bond. CBP does not limit the transmitter
by role but rather by knowledge of the information. To ensure accuracy,
CBP permits any party with that knowledge to come forward and transmit
the required electronic export manifest information, but to ensure the
electronic export manifest regulations are complied with, the
transmitter must have a bond on file.
Comment: One commenter stated that it is not appropriate to include
export-related obligations within the bond conditions controlling
importation or entry of merchandise. The commenter suggests that a new
subsection be created to incorporate bond conditions that ensure
compliance by parties that elect to file, or are required to file,
export-related information in accordance with CBP regulations.
Commenters further argued that imposing export-related obligations
within import bond conditions could create practical problems. For
example, one commenter explained that export cargo is often unrelated
to imported merchandise, so requiring export filers to use bonds
designed for imports is ``contradictory and out of place.'' Some
commenters wrote that parties such as shippers, consignees, or freight
forwarders may not have, or may not wish to use, import bonds for
export filings. They cited the Importer Security Filing (ISF) process,
where CBP created a separate bond appendix for parties without standard
bonds, and suggested a similar approach for export manifest filings. A
commenter wrote that requiring export filers to obligate import bonds
could force them to obtain unnecessary bonds or create confusion when
multiple bonds are active.
Response: The statutory framework of section 343 of the Trade Act
of 2002, as amended (19 U.S.C. 1415) addresses both import and export
making the inclusion of bonds consistent with the statutory text. Under
Trade Act of 2002, when CBP requires the provision of advance
electronic export cargo information, CBP shall impose the requirement
on the party most likely to have direct knowledge of the information.
The rail electronic export information requirements described in the
rule are consistent with this statutory framework as they seek the
information from the party best positioned to have it. The rule
[[Page 55182]]
encourages transmission by the party most likely to have direct
knowledge of the information, and the current bond structure is
sufficient to ensure compliance with it, with the amendments to the
bonds made in this rule. When a party holding a Basic Importation and
Entry Bond has this information and chooses to provide it, having a
consolidated bond that secures the party's compliance with this rule,
rather than requiring a new, separate bond, is the best way to ensure
the information transmitted is accurate and timely and involves less
cost to the transmitter and less administrative burden on all parties.
Furthermore, CBP directs the commenter to 19 CFR 113.64 which has
imposed export-related obligations within import bond conditions; this
regulation became effective on February 18, 1985 (49 FR 41171). For
instance, under 19 CFR 113.64(j), an agreement to deliver export
documents provides that ``[i]f the principal's vessel, vehicle, or
aircraft is granted clearance without filing a complete outward
manifest and all required export documents, the principal agrees to
file timely the required manifest and all required export documents.''
Section 113.64(m)(1) states that the ``[p]rincipal agrees that it will
not allow seized or detained merchandise, marked with warning labels of
the fact of seizure or detention, to be placed on board a vessel,
vehicle, or aircraft for exportation or to be otherwise disposed of
without written permission from CBP, and that if it fails to prevent
such placement or other disposition, it will redeliver the merchandise
to CBP within 30 days, upon demand made within 10 days of CBP discovery
of the unlawful placement or other disposition.''
Finally, CBP does not want to create a separate bond when the new
provisions can be absorbed within the current bond structure. Many
parties wanting to transmit information already hold a CBP bond and
will not be required to incur the expense of acquiring a separate bond
to handle export transactions only.
Comment: One commenter suggested that if CBP anticipates more than
one bond activity code may be used for the rail EEM, it will be
important that CBP records the party transmitting the information and
specify the bond the filer intends to obligate. The commenter suggests
that CBP could add an additional data element for the identification of
the filing party and filer's bond being obligated in each of the three
categories of data elements: sections 123.93(d) (used for the initial
filing), 123.93(e) (used for transportation data), and 123.93(f) (used
for cargo data). The commenter further suggests that these three
subsections should also include a mandatory data element that
identifies the filer's bond being obligated because it is not uncommon
for outbound carriers, or non-carrier information filers (e.g.,
shipper, consignee, freight forwarder, etc.), to have multiple active
continuous bonds that would contain export rail manifest-related bond
conditions. Lastly, the commenter suggests that, as is done with the
Importer Security Filings, the information filer should identify the
bond that it chooses to secure its filing obligations.
Response: CBP appreciates these suggestions and believes adding the
transmitter's identifying information as a data element will assist CBP
in identifying the transmitter's required bond. As such, CBP will add a
new data element for the transmitter's identifying information to
sections 123.93(d)(1)(vii) for the initial filing, 123.93(e)(1)(viii)
for transportation data, and 123.93(f)(1)(xi) for cargo data. CBP will
determine the obligated bond as follows: if the transmitter has an
active international carrier bond, the transmitter's international
carrier bond will be obligated to secure the filing; if the transmitter
does not have an active international carrier bond but does have an
active basic custodial bond, the transmitter's basic custodial bond
will be obligated to secure the filing; and if the transmitter has
neither an active international carrier bond nor an active basic
custodial bond but does have an active basic importation and entry
bond, the transmitter's basic importation and entry bond will be
obligated to secure the filing. CBP considered the commenter's
suggestion to allow filers to designate which of their bonds to
obligate but has decided to use this standardized hierarchy to promote
administrative simplicity and consistent enforcement.
Comment: One commenter suggested that the expansion of existing
bond conditions in certain sections of Part 113 of the CBP regulations
should be included to ensure compliance by parties that elect to file
or are required to file export information including to ensure clarity
and remove doubt.
Response: CBP appreciates this suggestion and believes that the
addition of the reference to ``(k)(3)'' to section 113.62(n) clarifies
the consequences of default and the calculation of liquidated damages
for each violation.
Comment: One commenter suggested that the proposed rule would
change carriers' bonding requirements and could result in unfair
enforcement against rail carriers because they could conceivably be
liable for liquidated damages based on the transmission of data of
which the carrier did not have direct knowledge. The commenter wrote
that the proposed rule also creates a disincentive for any other data
transmitter to actually transmit the data for which they have the most
direct knowledge because they are not required to submit the data.
Response: The rule treats bonding for exports for rail carriers in
a manner consistent with vessel and air carriers. In all modes, any
party with knowledge may step forward and transmit the necessary data
as long as that party has at least one of the three bonds that are
being amended to secure advance export information. Otherwise, the rail
carrier will be responsible for knowing what is on its train and
transmitting the data required. The bonding structure for outbound rail
transmissions is consistent with all bonding schemes for other modes of
transport. Additionally, as required by section 343 of the Trade Act of
2002, as amended (19 U.S.C. 1415), the regulations provide that, CBP
will take into consideration how, in accordance with ordinary
commercial practices, a rail carrier acquired the information, and
whether and how the rail carrier is able to verify the information. The
regulations also provide that, where a rail carrier is not reasonably
able to verify such information, CBP will permit the rail carrier to
electronically transmit the information based on what that party
reasonably believes to be true.
6. Issues Regarding Initial Filing
Comment: A few commenters suggested that for ocean shipments routed
via rail (specifically when an NVOCC has an ocean shipment departing
the U.S. via rail to a Canadian or Mexican seaport), CBP utilize the
Vessel Operating Common Carrier (VOCC) master bill of lading as the
linkage point in section 123.93(d) as it would be the least disruptive
and most operationally feasible approach. The commenters stated that
there is no feasible way for the NVOCC to obtain the waybill number
before the initial filing of house-level data.
Response: CBP appreciates the suggestion in these comments;
however, the waybill number exists before the initial filing of house-
level data and trade members may need to adjust business practices to
obtain that information to transmit in the initial filing in order to
comply with this rule. In co-loading scenarios, CBP recognizes
[[Page 55183]]
that master-loader NVOCCs may not have visibility into the lowest-level
house bill data, and CBP expects that, where practicable, the NVOCC
that issued the lowest-level house bill will provide that house-level
data either directly to CBP or through another EEM transmitter.
Comment: A few commenters request additional clarification for
section 123.93(d)(4) regarding potential risks of holds, delays, or
other issues if the cargo description in the EEM does not exactly match
the descriptions in other export documents. The commenters requested
clarification on whether such differences between the EEM and EEI
filings would hinder CBP's targeting objectives or result in shipment
holds, and if so, how such discrepancies should be addressed to ensure
smooth processing.
Response: CBP is interested in the cargo description from a
security aspect, not a statistical one. CBP utilizes both EEM and EEI
in its risk assessment as CBP considers all available data sets which
inform enforcement and facilitation determinations. CBP expects that
the additional data will improve and not hinder CBP objectives.
Comment: A few commenters stated that the requirement in proposed
section 123.93(d)(4), as written, indicates that the description
provided in EEM for a sealed container should be the ``shipper's
declared description'' and asked CBP to clarify whether the ``shipper's
declared description'' should match the description in the bill of
lading. Commenters stated that if the shipper's declared description
should match the description in the bill of lading, the description may
not provide the desired details.
Response: CBP notes that the EEM filer (transmitter) is expected to
meet the requirements of the regulation, and whether or not the
container is sealed is not the controlling factor in providing that
data. CBP expects that the party with the most direct knowledge of the
house-level bills will provide the EEM data either directly to CBP or
to another party which will transmit the EEM data to CBP.
Comment: A few commenters requested additional clarification for
sections 123.93(d)(5) and 123.93(d)(6). Commenters requested
clarification on what constitutes an acceptable ``identification
number'' for the shipper and consignee, noting that using an EIN may
not correspond to the party listed on the bill of lading and that there
is no standard identification number for foreign consignees. The
commenters noted that the consignee field in a bill of lading can vary,
creating potential uncertainty in reporting.
Response: CBP appreciates the comment and acknowledges the
potential uncertainty. To address this concern, CBP will remove
``identification number'' from sections 123.93(d)(5) and 123.93(d)(6),
and both sections are restructured to sections 123.93(d)(1)(v) and
123.93(d)(1)(vi) in this final rule.
Comment: A few commenters suggested that CBP adjust language in
section 123.93(d)(7) to include ITN or FTR exemption/exclusion codes.
These commenters further suggested that CBP should accept initial
filing even when the AES, ITN, or FTR exemption/exclusion statement is
not yet available. Commenters suggested CBP move this data element to
the mandatory cargo data section, allowing an NVOCC to transmit it in
the initial filing when available or as part of a supplemental filing
at a later time, as long as it remains within the required transmission
timeframe. The commenters ask CBP to verify that appropriate processes
are in place to ensure rail carriers' manifest filings can accommodate
all applicable ITNs and exemption/exclusion statements.
Response: CBP acknowledges this concern and as a result will amend
section 123.93(d) of the initial filing to include both mandatory and
conditional elements in this final rule. CBP is revising this provision
such that the data element ``The Automated Export System (AES)
Exemption Statement, as applicable'' is amended to conditional and
revised to state that ``AES, ITN, or FTR exemption/exclusion code must
be transmitted if, and as soon as, applicable.''
Comment: One commenter suggested that there is no need to have the
initial data elements transmitted 22 hours prior to the transportation
data elements and cargo data elements. Rail carriers may have a rail
yard that is only an hour or two from the point of export, or where a
train maybe traveling to Canada and may have to pick up cars for export
along the way. In this case, the rail carrier will construct the train
and transmit the initial filing and then need to hold the train for
over 20 hours in the yard or somewhere else less secure between the
yard and the point of export. The commenter also remarks that this was
not how the Test program worked and suggested that transmission time
for all three data elements should be aligned at two hours prior to
departure from the country.
Response: CBP disagrees as the deadlines for data elements are
based on hours prior to the train departure from the U.S. port of
export, not crossing the border. 19 CFR 123.93(d) requires an initial
filing of eight data elements (7 mandatory and 1 conditional)
identified to be transmitted as early as practicable, but no later than
24 hours prior to departure from the U.S. port of export, by either the
carrier, USPPI, or other qualified parties or their authorized agents.
The results of the Test have shown that some rail carriers will have
the export manifest data available days in advance prior to departure
and therefore will have all the necessary information to transmit the
initial filing data to CBP and all other export manifest data well in
advance of the 24 hours prior to departure deadlines. As noted, during
the duration of the Test, CBP has kept such disruptions to a minimum.
Comment: One commenter suggested that the rule will create major
disruptions for railroads. The commenter argued that:
<bullet> Because the rule prohibits carriers from transporting
cargo subject to a DNL or Hold instruction, and because CBP will only
know whether to issue such an instruction after it has received and
reviewed all three sets of data (initial filing at 24 hours, and
transportation and cargo data at 2 hours before departure), carriers
would in practice need to hold trains until CBP has completed its
review and communicated whether any DNL/Hold applies.
<bullet> Moreover, according to the commenter, it appears that a
referral or DNL/Hold decision will be made by CBP after all data
elements are collected from the data transmitters.
<bullet> As a result, export trains assembled in a yard could be
forced to sit for more than 24 hours while awaiting CBP's review and a
de facto ``all-clear,'' which is inconsistent with how rail yards are
designed--i.e., for high throughput and minimal dwell time.
<bullet> The commenter further stated that if trains or cars must
be held at or near border crossings for inspections triggered by DNL/
Hold decisions or referrals, this would require complex switching or
live-lift operations at locations that often have single-track
constraints and limited infrastructure, causing cascading delays and
missed ``slots'' for both export and other traffic on the line.
<bullet> In the commenter's view, these effects would substantially
increase dwell time, force carriers to redesign their train-slotting
practices, and decrease overall network fluidity.
The commenter stated that the timing of data set transmissions is
also problematic as there is no need to have
[[Page 55184]]
the initial data elements transmitted 22 hours prior to the
transportation data elements and cargo data elements.
Response: CBP notes that the outbound electronic rail manifest
requirements do not obligate carriers to wait for an affirmative ``all-
clear'' message from CBP prior to movement, and do not obligate CBP to
wait for all data to be submitted before CBP can issue a DNL or Hold
instruction. Under 19 CFR 123.93, carriers must meet the prescribed
filing deadlines and must not transport cargo that is subject to a DNL
or Hold instruction, but they are not required to hold trains solely to
await a separate notification that no such instruction has been issued.
Additionally, CBP notes that feedback obtained from the rail EEM Test
participants indicates they did not experience disruptions while
participating in the Test.
In general, CBP does not anticipate that the final rule will impose
the prolonged yard dwell times, widespread slotting conflicts, or
systemic network disruptions described by the commenter. When EEM data
is provided within the deadlines set forth in this rule, cargo
inspections will be conducted at a U.S. port of export location
determined by CBP. Therefore, CBP anticipates that cargo inspections
occurring between the U.S. port of export and the actual border
crossing would be rare instances where a significant imminent threat is
identified after the train is given clearance and has departed the
United States from the final port of export.
CBP acknowledges that certain ports of export and border crossings
have unique yard and infrastructure constraints such that carriers may
need to adjust operational procedures as needed to minimize unwarranted
disruption.
CBP acknowledges that carriers remain free to build in their own
buffers, but notes that such self-imposed dwell is not required by the
rule and is too speculative for CBP to quantify.
Regarding the commenter's objection to requiring initial data
elements at least 22 hours prior to the transportation and cargo data
elements, this comment is contrary to the long-stated trade desire for
progressive filings when information is known.
Comment: One commenter suggested that CBP's assumption that a 24-
hour transmission timeframe for the initial data elements was based on
a flawed Test program design. The commenter further suggested that CBP
expand its Test program to incorporate different points of export to
learn from real-world experiences how rail carriers operate at the
border and that continuing to expand the Test program could provide for
better outcomes in the long run.
Response: The time frames set out in this rule are a compromise
that allows commerce to flow while providing CBP the ability to
identify risks and to examine cargo in the export process. CBP opened
participation in the Test program to any and all rail carriers as well
as other members of the trade as of 2017. The only limitation was that
participation from rail carriers and other trade members needed to be
voluntary. There were no restrictions with regard to the participant's
organization size, location, or commodity type for participation in the
test. 82 FR at 37894. CBP does not support the idea of further
extending the Test where additional voluntary participation is unlikely
to occur.
7. Date of Departure
Comment: A few commenters requested additional clarification on
section 123.93(e) ``Date of departure''. They stated that CBP does not
specify whether this data element refers to the departure date from the
United States. To ensure consistency and clarity, the data should
explicitly state that it represents the date the train crosses the
international border, leaving the United States.
Response: CBP agrees that for this rule the term ``Date of
departure'' constitutes the date that the train crosses the
international border, exiting the United States.
8. Assistance for Stakeholders
Comment: A number of commenters urged CBP to release an EEM
business process document to allow affected parties to more accurately
formulate compliant and effective business processes internally and
with their business partners.
Response: CBP agrees and intends to cooperate and provide support
to trade members during the transition process where the trade will be
providing EEM data to CBP. CBP agrees that providing an EEM business
process document will be beneficial and intends to provide that
documentation to trade members.
Comment: One commenter requested that CBP engage with supply chain
stakeholders, including manufacturers, distributors, shippers,
exporters, logistics providers, and technology solution developers,
throughout the rulemaking process and provide adequate support and
education on compliance requirements, especially for smaller players in
the supply chain.
Response: CBP has engaged with stakeholders throughout the
rulemaking process and will continue to do so during the implementation
phase of this rule.
9. General Opposition to Rule With Suggested Changes/Improvements
Comment: One commenter who opposed the rule stated that statutory
principles should guide the rulemaking and that ``the requirement to
provide particular information shall be imposed on the party most
likely to have direct knowledge of that information . . . [and] [w]here
information is not reasonably verifiable by the party on which a
requirement is imposed, the regulations shall permit that party to
transmit information on the basis of what it reasonably believes to be
true.''
The commenter suggested that, to comply with the congressional
directive, the only information a rail carrier should be required to
provide is the mandatory data subset of the export manifest
transportation data. The commenter further suggests that the rule
should be revised to only permit enforcement on the rail carrier for
misstatements regarding the mandatory data subset of the export
manifest transportation data. The commenter objected that the proposal
places the onus on the rail carrier to transmit all data elements.
Response: CBP agrees that statutory principles guide this
rulemaking, including the authority to promulgate regulations providing
for the mandatory transmission of electronic cargo information,
pursuant to section 343(a) of the Trade Act. Furthermore, this rule
encourages the parties with the knowledge to supply the data. While all
eligible parties are encouraged to transmit data, the ultimate
obligation must rest with at least one party. Furthermore, there must
be a responsible party to reach should questions about the data arise
and/or violations involving false or inadequate transmission of data
occur. Without a clear identification of the transmitter of the data
whose bond is liable, CBP would never be able to identify the party
responsible for any data transmission deficiencies. As with other data
transmission rules, this regulation allows any party with the necessary
information to transmit it, but if no other party comes forward and
elects to transmit the data, the ultimate responsibility must fall on
the carrier as the party transporting the shipment out of the United
States. If the carrier does not provide the necessary information, the
carrier has the ability to remove the cargo as the conveyance will not
be authorized to leave the United States.
[[Page 55185]]
10. DNL/Holds
Comment: One commenter stated that the rule would have unintended
consequences to the fluidity of the rail network and supply chain,
citing the following concerns: if there is a referral made under
proposed 19 CFR 123.93(g), then the car, unit, or empty container may
not be exported; if a DNL/Hold instruction is made, then the rail
carrier may not even transport the car, unit, or empty container at all
under proposed 19 CFR 123.93(h); it appears that a referral or DNL/Hold
decision will be made by CBP after all data elements are collected from
the data transmitters, but CBP will not have all data elements until
two hours prior to departure, at which point a rail carrier under
normal circumstances would already have the train underway. This
commenter suggests that CBP eliminate the DNL/Hold instruction
provision of the rule.
Response: CBP disagrees that it should eliminate the DNL/Hold
instruction provision as the regulation does not state that CBP will
make decisions only after all elements are collected. In fact, one of
the purposes of the rule is to provide trade members with the ability
to provide data on a continuous basis as information becomes available,
which allows CBP to review the data on a continuous basis as it is
transmitted. Additionally, under the rule at 19 CFR 123.93(h), if a CBP
officer determines during the review that cargo or a rail car may
contain a potential threat to the train and its vicinity, then a DNL
instruction may be issued. Any such warning will assist in avoiding a
catastrophic event; so, in those instances, any transportation delay
and resultant inconvenience will be insignificant when compared to a
possible catastrophe averted.
Comment: One commenter stated that the rule should be modified to
allow rail carriers and CBP to designate inspection areas to reduce the
need for infrastructure, facilities, manpower, and equipment at the
actual border crossing or point of export.
Response: CBP will be flexible in working cooperatively with
carriers to accomplish necessary inspections with as minimal disruption
as possible, but inspectional decisions reside solely with the agency.
The transmission of EEM data in advance helps CBP review and allows CBP
to issue holds before cargo is loaded or before a train reaches the
U.S. port of export, thereby limiting the number of issues that CBP
must address at the U.S. port of export and reducing potential delays.
11. Timing
Comment: One commenter was concerned about the timing of CBP
referrals if the train is in route to the point of export where such an
inspection will occur. The commenter wrote that NPRM seems to
contemplate that inspections could just occur at the port of export,
which is not that simple for the rail carriers.
Response: CBP understands this concern and will endeavor to perform
all inspections with the least inconvenience to the trade. CBP
anticipates that the deadline requirements of this rule for
transmitting information allows CBP to conduct most, if not all risk
assessments, and identify potential cargo that may be inspected prior
to the train departing the port of export. If, however, a CBP officer
determines that an inspection needs to occur while in transit to avoid
a catastrophic threat, any transportation delay and inconvenience that
might be caused will be insignificant when compared to averting a
disaster.
12. Resources
Comment: One commenter stated CBP does not have the necessary
resources for a rule of this magnitude and expressed concern at how CBP
will inspect at points of export.
Response: CBP notes that resource management and inspection
techniques fall outside the scope of this regulation and do not need to
be considered. However, CBP will inspect cargo in a manner that causes
the least amount of disruption to the flow of commerce. CBP anticipates
that inspections will occur before the train departs the port of export
but acknowledges that there could be instances where an inspection
needs to occur between the port of export and crossing the border. CBP
does not anticipate that this will be a common event, especially when
data is provided within the deadlines of this rule.
13. Burden on Carriers
Comment: One commenter stated that the burden imposed on carriers
regarding the application of the EEI proposal to empty containers is
not justified by the risk because providing that data will be onerous
for rail carriers, especially when most rail equipment including
containers are not owned by the rail carrier, but instead by shippers,
equipment manufacturers, or lessors. The commenter expressed concern
that because such data is not provided by rail carriers to CBP for
empty containers, an entire system will need to be developed to do so.
Response: CBP maintains the right to make security and enforcement
decisions on the level of risk involved. Additionally, empty containers
are listed in the train consist currently being provided by
participants now, and do not require any additional data to be provided
in accordance with this rule. As identified above, this rule will be
effective 60 days from the date of publication, and a longer time
period will be provided to facilitate the transition before enforcement
begins.
14. Uniform Enforcement
Comment: One commenter suggested that CBP take steps to ensure that
it enforces the final rule uniformly across all points of export
because some rail carriers export cargo to northern, southern, and
maritime borders.
Response: CBP's goal is to make enforcement uniform in the rail
export environment and to have consistent enforcement procedures where
feasible. CBP notes that each port of export is unique and presents its
own challenges. CBP will endeavor to have uniform enforcement at every
port to the best of its ability.
15. Comments on Cost Benefit Analysis
Comment: A few commenters expressed concern about the requirement
for house-level data. They recognized CBP's need for house-level data
and stated that implementing this change for NVOCCs will necessitate
``significant investments'' in programming, process adjustments,
training, and associated costs and will require time to effectuate.
These commenters encouraged CBP to address these concerns in the
submission of the final rule to ensure effective and practical
implementation that aligns with industry operations.
Response: CBP acknowledges that the modernization of the export
manifest process, may result in trade members adjusting their business
practices in order to comply with this regulation. However, CBP
believes this final rule provides the best option to transition to
electronic environments and implement the Trade Act authority in a way
that also improves CBP's enforcement efforts on cargo security and
smuggling prevention. CBP notes that the data elements being requested
exist before the deadlines established for the data transmission. Trade
members may need to adjust their current processes in order to meet the
EEM data requirements. CBP agrees with the concern raised by these
commenters that there could be significant investments required for
NVOCCs and other non-rail carrier trade members that elect to
participate and
[[Page 55186]]
directly transmit EEM data to CBP. However, CBP notes that for these
trade members direct participation is voluntary and therefore they will
only directly participate if it makes business sense for them to do so.
In the NPRM, CBP specifically requested comments from trade members
on these potential costs to adjust business practices; however, no
specific monetized estimates were provided. These commenters suggest
there would be ``significant investments,'' but this statement lacks
the specificity needed for CBP to monetize such investments in the
economic analysis for this rule. However, CBP acknowledges that the
investments for these parties if they choose to participate directly as
rail EEM transmitters could be significant, and they would likely also
incur some cost savings as well. CBP's economic analysis for the NPRM
included a discussion of these costs and CBP has added to that
discussion based on the information received in this public comment.
Comment: One commenter stated that the cost-benefit analysis
provided was flawed and failed to account for significant costs that
would be imposed by this rule. The commenter asserted that the rail
network is not designed for disconnecting rail cars for inspection
outside of the port of export/rail yard. The commenter suggested that
implementing the necessary infrastructure and equipment at all points
of export would cost millions of dollars in land acquisition and rail
construction, and significant delays in rail transportation at certain
points of export. The commenter also suggested that trade members would
be required to develop new programming to provide the new data elements
to CBP. Furthermore, the commenter stated that because this NPRM
introduced a CBP system-generated inspection not currently done at
export, it would result in increased delays of rail traffic and not
time benefits to the rail carriers.
Response: CBP disagrees that the rule will necessitate the
disconnection of rail cars for inspection outside of the port of
export/rail yard. CBP believes this rule provides sufficient time for
the data to be provided so CBP can complete a proper risk assessment
such that all cargo inspections will be conducted before the train
departs from the final port of export. CBP retains the authority to
conduct inspections, when necessary, even if it must be conducted
between the train's departure from the final port of export and
crossing the international border. In such an instance, this will
result in a delay in the train's departure from the United States and
will result in a cost to the rail carrier. CBP notes that these
scenarios would be in the very rare cases where a significant imminent
threat is identified after the train is given clearance to depart the
United States from the final port of export and has not yet crossed the
international border, and CBP will request the train be routed to where
an inspection can be conducted. CBP does not quantify these costs
because they are very unlikely to occur. CBP's goal is to conduct such
inspections with the least amount of disruption to the trade whenever
possible.
Additionally, CBP notes that the rule's requirements for data
transmissions prior to departing the U.S. port of export will further
limit the number of inspections that will need take place between the
U.S. port of export and crossing the international border. CBP plans to
move forward with the existing infrastructure at border crossings and
does not expect rail carriers or CBP to invest in these significant
costs as stated by this commenter.
CBP acknowledges that rail carriers will incur systems costs, and
CBP has accounted for the systems costs to rail carriers in the
analysis for this rule. Regarding the system costs to other trade
members, CBP notes that their participation in providing EEM data
directly to CBP is voluntary and as such CBP assumes that they will
only do so if it were beneficial to their business. CBP requested
feedback on those potential costs but did not receive specific feedback
during public comments to provide an estimated amount to the average
non-rail carrier participant. The feedback received from the rail EEM
Test participants suggested that providing the EEM data to CBP did not
result in any increased delays of rail traffic.
Comment: One commenter stated that the rule is based on a Test
pilot program that was limited in its application and does not account
for concerns raised in the comment provided. Because the pilot was
limited in application and scope, the commenter stated that the Test
pilot program is not a good representation of costs to trade members
when this rule is finalized. The commenter stated that not all Class I
carriers were involved in the Test and those that were, did not have
every possible point of export included in the Test. The commenter
stated that no points of export at the southern border were included in
the Test because these are more difficult points of export. Lastly, the
commenter stated that CBP wrongfully overestimated the high compliance
rate for rail carriers transmitting data 24 hours before departure and
noted that one participant had to redesign its operations to account
for an inspection at the border crossing rather than the yard.
Response: CBP has been conducting the Electronic Export Manifest
Test for Rail Cargo since 2015. The rail EEM Test data received was
limited by what Test participants were willing to provide. CBP did not
limit Test participants to provide rail EEM Test data only at specific
ports of export. Because participation in the Test was voluntary, the
participants, not CBP, determined what data to provide to CBP. CBP
based its cost estimates on the information that was available from the
Test and based on feedback from the rail EEM Test participants. CBP
provided its best estimates on the costs associated with this rule
based on the information available to CBP and the participation in the
pilot. CBP acknowledges there may be a range of estimates because not
all experiences may be the same. However, CBP will endeavor to perform
all inspections with the least inconvenience to the trade. CBP
anticipates that the deadline requirements of this rule will allow CBP
to conduct most, if not all, risk assessments and identify potential
cargo that may need to be inspected prior to the train's departure from
the United States.
CBP acknowledges this comment and concern that Test data was not
provided at all port of export locations and that there may be
differences between different ports of export and that there may be
certain industry practices that could create unique challenges
resulting in costs. However, CBP has taken this comment into
consideration and incorporated these concerns into the analysis for
this rule. Since this comment did not provide quantitative estimates
for these costs, CBP can only provide a qualitative discussion of these
potential costs to trade members that did not participate in the rail
EEM Test.
Comment: One commenter disagreed with CBP's assumption that there
would be negligible additional cost to rail EEM participants to comply
with the bond requirements. Specifically, the commenter's concern is
for rail carriers that would be responsible for transmitting all data
elements if no other party elects to participate, and then the rail
carriers would be liable for the liquidated damages based on data that
the rail carrier was provided and about which the carrier lacked direct
knowledge.
Response: CBP notes that rail carriers may be required to be the
EEM
[[Page 55187]]
transmitter for all data if no other eligible party elects to directly
transmit the data. However, if the parties with the most direct
knowledge of the information decide not to transmit the EEM data
directly to CBP, they must provide that information to rail carriers in
a timely manner, or the cargo cannot be exported. Additionally, the
regulations provide that, where a transmitting party (including a rail
carrier that transmits EEM data to CBP) is not reasonably able to
verify information that it receives from another party in accordance
with ordinary commercial practices, it may electronically transmit the
unverified information to CBP based on what the transmitting party
reasonably believes to be true.
CBP also notes that all rail carriers that engage in carrying goods
for export out of the United States are also engaged in carrying goods
for import into the United States and therefore already have a
requirement to secure and obtain a bond, so CBP expects adding this
provision will not add a significant cost to these rail carriers.
VII. Regulatory Analyses
A. Executive Orders 12866, 13563, and 14192
Executive Orders 12866 (Regulatory Planning and Review) and 13563
(Improving Regulation and Regulatory Review) direct agencies to assess
the costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits. Executive Order 13563 emphasizes the importance of
quantifying both costs and benefits, of reducing costs, of harmonizing
rules, and of promoting flexibility. Executive Order 14192 (Unleashing
Prosperity Through Deregulation) directs agencies to significantly
reduce the private expenditures required to comply with Federal
regulations and provides that ``any new incremental costs associated
with new regulations shall, to the extent permitted by law, be offset
by the elimination of existing costs associated with at least 10 prior
regulations.''
The Office of Management and Budget (OMB) has designated this rule
a ``significant regulatory action'' under section 3(f) of Executive
Order 12866, although not economically significant under section
3(f)(1). Accordingly, the rule has been reviewed by the Office of
Management and Budget.
This final rule is considered an Executive Order 14192 deregulatory
action. CBP's quantified estimates demonstrate this rule generates
$9.01 million in annualized net cost savings using a seven percent
discount rate, discounted relative to year 2024, over a perpetual time
horizon. However, the costs imposed by the rule are not fully
quantified.
In summary, CBP expects that this final rule will result in a
present value total combined net cost savings of $37.5 million using a
three percent discount rate and $22.7 million using a seven percent
discount rate; to CBP, outbound rail carriers and other trade members
during the period of analysis (2016 to 2030). Meanwhile, annualized net
cost savings are estimated to range between $3.1 million and $2.5
million using a three and seven percent discount rate respectively. CBP
anticipates that this final rule will also provide added benefits from
enhanced cargo security measures by improving compliance and the
enforcement of U.S. export laws and regulations on U.S. rail exports,
while also improving the facilitation of the export process. The
following is the economic analysis of the potential effects from this
final rule. Based on feedback from public comments received from the
rail EEM NPRM, CBP made a few changes between the analysis for the NPRM
and for this final rule. CBP revised a data element ``AES Exemption
Statement, as applicable'' to ``AES (AES) Internal Transaction Number
(``ITN'') or FTR exemption/exclusion code'', and this data element will
be conditional in the initial filing in this final rule. Additionally,
CBP removed the requirement to have trade members provide telephone and
email address that is monitored 24 hours/7 days a week to address any
holds issued by CBP. CBP does not expect these changes to result in any
additional quantifiable costs or cost savings from this final rule.
Purpose and Background
CBP's mission includes ensuring cargo security and preventing
smuggling, while enforcing U.S. trade laws and regulations. CBP needs
to obtain timely and sufficient data prior to cargo arriving or
departing the United States, via any mode of commercial transportation,
in order to review and conduct risk assessment to identify high-risk
shipments and inspect cargo effectively. According to Section 343(a) of
the Trade Act of 2002, as amended (Trade Act) (19 U.S.C. 1415), CBP is
authorized to establish regulations that provide for the mandatory
electronic transmission of data by way of a CBP-approved electronic
data interchange before cargo arrives or departs the United States in
all environments (sea, air, rail, and truck). Transmitting export
manifest data electronically, instead of on paper or via email, allows
CBP to use its Automated Targeting System (ATS) to screen all data
transmitted. This allows CBP to make better examination decisions while
also reducing the time required to make such decisions. Trade members
also experience efficiencies through quicker CBP examination decisions
and improved communication between CBP and trade members. The
requirement to transmit manifest data through an electronic data
interchange (ACE), which is the same system through which data is
incorporated from AES, is also important to help facilitate a more
efficient trade process for all federal agencies and trade members
involved. Transmitting electronic manifest data (specifically pre-
arrival or pre-departure) significantly increases CBP's ability to
conduct risk assessment and identify high-risk cargo to ensure cargo
security and to prevent smuggling. Additionally, the electronic
environment will improve and expedite communications between CBP and
trade members in resolving examinations where additional or corrected
information of the transmission is required.
Baseline
In the rail environment, CBP currently requires the advance
electronic submission of data for all cargo being brought into the
United States, but CBP does not require the pre-departure electronic
transmission of data for all exported cargo. CBP requires some
electronically transmitted cargo data prior to departing the United
States by rail but this data is significantly limited in scope. Current
regulations \8\ require the U.S. Principal Party in Interest (USPPI),
the USPPI's agent, or the authorized filing agent of the Foreign
Principal Party in Interest (FPPI) to transmit Electronic Export
Information (EEI) to CBP through the Automated Commercial Environment
(ACE), no later than two hours prior to the arrival of the train at the
border. Although this pre-departure data is helpful, the information
provided by EEI falls short of what CBP requires for proper
enforcement.
---------------------------------------------------------------------------
\8\ See 19 CFR 192.14.
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Additionally, the required transmission of EEI is subject to
certain exemptions, as established by the Bureau of the Census
regulations,\9\ which generally only require EEI transmission on
shipments greater than $2,500 and do not require the transmission of
EEI for shipments destined for Canada, unless the
[[Page 55188]]
shipment contains certain controlled items or is being transshipped to
another destination.\10\ Therefore, numerous low dollar value shipments
and/or Canadian-bound shipments of merchandise departing the United
States by rail do not have EEI transmitted for CBP to review. The lack
of detailed electronic manifest data for some shipments and the
unavailability of electronic cargo data on lower value merchandise
shipments impedes CBP's enforcement efforts on rail exports.
---------------------------------------------------------------------------
\9\ See 15 CFR Part 30.
\10\ See 15 CFR 30.36.
---------------------------------------------------------------------------
Although CBP receives limited pre-departure electronic data for
rail exports, CBP usually receives additional pre-departure data from
rail carriers or their agents. This information, however, is submitted
via attachments to an email, which is not the most efficient or
effective method to obtain such data and perform risk assessment.\11\
During the export cargo process, the rail carrier may not load cargo
without first receiving from the USPPI or its authorized agent either
the related EEI filing citation, covering all cargo for which the EEI
is required, or exemption legends, covering cargo for which EEI need
not be filed. While the rail carrier is not required to submit a rail
cargo export manifest to CBP, the outbound rail carrier must annotate
the carrier's outward manifest, waybill, or other export documentation
with the applicable Automated Export System (AES) proof of filing, post
departure, downtime, exclusion, or exemption citations, conforming to
the approved data formats found in the Bureau of the Census Foreign
Trade Regulations.\12\
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\11\ This information is submitted by rail carriers for trains
transporting cargo out of the United States and is provided
regardless of whether an EEI submission is required.
\12\ See 15 CFR part 30.
---------------------------------------------------------------------------
In the baseline rail carriers or their agents submit finalized
train consists to CBP in a format of the rail carrier's choosing before
a train is granted permission to depart from the U.S. port of
export.<SUP>13 14</SUP> Rail carriers or their agents can provide this
data via email prior to a train's arrival at the U.S. port of export
(pre-departure) or present this data to a CBP officer at departure when
the train arrives at the U.S. port of export (at departure). The
submission of such data pre-departure via email is not mandatory, nor
is there a required time frame for submitting such information.
However, rail carriers have an incentive to provide this information
pre-departure so that CBP has time to review the information before the
train reaches the U.S. port of export, expediting the export process.
Because of this incentive, rail carriers usually send this information
to CBP at least two hours prior to a train's arrival at the United
States border.\15\ If rail carriers or agents choose not to provide
this data pre-departure, they must present the finalized train consists
to CBP upon arrival at the U.S. port of export at which point CBP
officers must complete the review of the train consists while the train
is at the U.S. port of export, resulting in a potential delay in the
train's departure.
---------------------------------------------------------------------------
\13\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
February 25, 2022.
\14\ A train consist is documentation that generally refers to
the contents of a train including the position of the locomotives
and cars, as well as both non-hazardous and hazardous freight within
those cars.
\15\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on June
21, 2022.
---------------------------------------------------------------------------
Once this information is received by CBP (either via email or in
person at the port of export), CBP officers will then conduct a review
of the export information, which includes reviewing the finalized train
consist (paper version or emailed) manually and addressing any issues.
CBP officers must then also compare this data with any EEI information
transmitted electronically for that train along with any other
documents. To ensure proper cargo security, during this review CBP
officers must also conduct their targeting and risk assessment measures
and then determine if any cargo needs to be examined before a train
departs the United States. In the baseline scenario, CBP is not able to
automatically use ATS for risk assessment on the export information
contained on the train consists provided by rail carriers to CBP.\16\
Although CBP officers can manually query ATS with information provided
on the finalized train consists, CBP notes this is a cumbersome and
time-consuming process and is not a frequent occurrence. If during
CBP's review of this information, prior to the train's arrival at the
U.S. port of export, CBP officers find any discrepancies or missing
data, CBP communicates via email to the rail carrier that submitted the
data, requesting updates or corrections to the data provided. The CBP
review process, including communications between CBP and rail carriers
about discrepancies discovered while reviewing train consist
information, can be unnecessarily cumbersome and time consuming because
this data is provided via email attachments and the formats can be
inconsistent across rail carriers. If CBP is not provided the pre-
departure data or is not provided the data in a time frame that allows
for CBP to properly review, request, and receive updates from rail
carriers, and conduct proper risk assessment or examine high-risk cargo
or shipment manually, then a CBP officer must resolve these issues at
the U.S. port of export. This usually results in a delay to the train's
departure.
---------------------------------------------------------------------------
\16\ In the baseline scenario CBP is not able use ATS for risk
assessment on export data submitted on paper forms (or via email)
and paper forms cannot be automatically uploaded or submitted to ATS
for risk assessment. A primary benefit of this rule is allowing CBP
to automatically use ATS for risk assessment on all rail EEM data
provided.
---------------------------------------------------------------------------
CBP does not track how often rail carriers provide this pre-
departure data nor to what extent CBP officers are able to conduct some
or all of their manual review of the data prior to the train's arrival
to the U.S. port of export. Sometimes CBP identifies a high-risk cargo
or shipment during manual review at the U.S. port of export or while
reviewing pre-departure data but does not have time to adjudicate the
shipment prior to a train's arrival at the U.S. port of export. In this
situation, the CBP officer holds the train until one or more freight
car(s) can be removed from the already constructed train for
examination, which can cause delays and can be costly to rail
carriers.\17\
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\17\ Unfortunately, CBP does not track how often manual
examinations occur on average each year as these examinations are
not entered into a system of record.
---------------------------------------------------------------------------
This final rule will establish a requirement for the electronic
transmission of export manifest data pre-departure from the United
States for all cargo in the rail environment. CBP defines the process
described above as the regulatory baseline and the analysis of this
final rule attempts to measure any incremental costs, cost savings, or
benefits compared to the baseline scenario.
The ACE Export Manifest for Rail Cargo Test
CBP has been working toward developing a new process to require the
transmission of electronic export manifest (EEM) data for all cargo
departing the United States by rail to enhance CBP's efforts to ensure
cargo security while also preventing smuggling and implement the Trade
Act authority. CBP expects that the transmission of pre-departure EEM
data would help CBP obtain all the necessary data to successfully
review and conduct risk assessment measures before trains reach the
U.S. port of export, thereby limiting the number of issues that CBP
must address at the U.S. port of export and reducing potential delays.
Rail carriers have also acknowledged that the
[[Page 55189]]
baseline process of sending forms of rail export data by email is
unnecessarily costly, time burdensome, and inconsistent with the
process for providing data on cargo entering the United States.\18\ As
such, rail carriers have generally been supportive of CBP's efforts to
provide a more efficient process by allowing for the transmission of
rail EEM data.
---------------------------------------------------------------------------
\18\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
---------------------------------------------------------------------------
In September of 2015, CBP introduced a two-year pilot test program,
referred to in this analysis as the ACE Export Manifest for Rail Cargo
Test (the Test), to determine the feasibility for rail carriers or
their agents to provide pre-departure EEM data for rail exports to CBP
via ACE within a specified time before cargo departs the United States.
To test the functionality of this new process, CBP initially limited
participation in the Test to nine rail carriers. During this initial
phase of the Test, CBP worked with rail carriers who agreed to
participate and transmit EEM data to CBP via ACE in addition to
providing paper forms. The participants were large rail companies,
similar in most respects to those that did not participate. As such,
CBP believes their experience with the Test is informative for
analyzing the effects of the rule. CBP requested comment during the
NPRM on any meaningful differences between the participants and the
non-participants that would affect the analysis. CBP did receive a
public comment stating that the rail EEM Test experienced limited
participation, that not all Class I carriers were involved in the Test,
and not every point of export was included in the Test. The commenter
stated that because of these factors, the Test does not provide a good
representation of the costs. CBP acknowledges that participation in the
Test was limited but CBP notes that the Test was expanded and extended
in 2017 and has since been available to all trade members. CBP
acknowledges that effects from this final rule will be different
depending on the trade member and the port of export, but CBP believes
that the quantitative data provided in the analysis for this final rule
which is based on feedback from the public through public comments and
rail EEM Test participants is CBP's best quantitative estimate. Any
effects CBP was unable to quantify CBP discusses qualitatively. CBP
included input received through the public comments to improve its
analysis, though some commentors did not provide substantive or
quantitative information that could be used in the analysis. In
addition, CBP has made changes to the rule in response to public
comments that highlighted costs that would be more severe for certain
trade members, including smaller trade members.
CBP requested that rail EEM Test participants continue to provide
data in paper forms as they did before the Test so that CBP could
capture any inconsistencies or issues with the electronic transmission
of rail export manifest data to CBP. In the Test, CBP requested that
participants provide rail EEM data to CBP at least two hours prior to
loading the cargo onto the train, or in the case of empty rail cars
upon assembly of the train.\19\ Because ACE would conduct a majority of
the risk assessment and review of electronically transmitted data, CBP
anticipated that this two-hour window would provide enough time for CBP
to review pre-departure EEM data prior to the cargo being loaded onto
trains and before the trains have been assembled. The two-hour time
frame also provided CBP the opportunity to notify rail carriers or
agents to revise and correct export manifest data where necessary
before the cargo is loaded. This increased the chance that CBP could
conduct cargo inspections before cargo is loaded and trains are
assembled, avoiding costly time burdens if issues need to be addressed
after the train has been constructed. The required deadline for EEM
data also provided CBP an opportunity to compare any EEI transmitted by
the USPPI with the export manifest data to properly conduct safety and
security screening for cargo departing the United States in the rail
environment.
---------------------------------------------------------------------------
\19\ CBP notes that although the Test requested export manifest
data to be provided within certain deadlines, participants were not
required to provide data within these time frames. Participants were
given flexibility to provide the data to CBP electronically and were
not penalized if export manifest data was not transmitted within the
time frames of the Test. However, CBP experienced high levels of
compliance with EEM data transmissions with 94 percent of all data
transmissions submitted greater than 24 hours prior to the departure
time.
---------------------------------------------------------------------------
One major improvement of the Test was that rail carriers can
provide and revise export manifest data electronically on a flow basis
when the export data becomes available during the export process.
Typically, rail carriers provide export manifest data in documents
known as bills of lading (bills), which act as a receipt and contract
of transporting cargo and goods. These bills can come from a number of
sources depending on which party is privy to the information and the
timing of when the information is provided. A house bill contains cargo
details and is issued directly by a party such as a Non-Vessel
Operating Common Carrier (NVOCC) or freight forwarder. This bill acts
as the receipt of exported goods and provides export manifest data at
its lowest level. Carriers issue a master bill which includes all other
export manifest information such as transportation details for the
transporting train covering any number of house bills that are included
on that train. Additionally, in the case where a NVOCC or freight
forwarder is not involved in the shipment transaction and the carrier
has the specific cargo data available, the carrier can issue a ``simple
bill,'' which is similar to a house bill and contains cargo details at
the lowest bill level of export manifest data. In the rail environment,
house bills and master bills are not typically issued because rail
carriers usually issue simple bills for all cargo and then submit
finalized train consists to CBP. These consists include the simple
bills associated with all the cargo on the train and any other
transportation data for the train prior to departure from the U.S. port
of export. The Test allowed participants to transmit these simple bills
on a flow basis when the information becomes available. This differs
from the baseline scenario where rail carriers typically waited for
simple bills to be finalized before sending the export manifest data in
the finalized train consist in paper format to CBP for review. The
transmission of EEM data, via ACE, allows for the integrated system to
conduct a large portion of the review process using data validations,
checks, and risk assessment measures prior to the rail carriers loading
cargo onto freight cars or constructing the train. Additionally, upon
transmission of the pre-departure EEM data, CBP can review data on a
flow basis while rail carriers provide updated data throughout the
export process.
The integrated system will generate two types of holds when rail
carriers transmit bills: 2H Documentation holds, which notifies the
rail carriers or their agents in the integrated system of outstanding
issues with the data provided, and 1H Enforcement holds, which result
from CBP's risk assessment. In the instance of a 2H Documentation hold,
the rail carrier or agent must add or revise the missing or incorrect
reference data in order to release the hold on the cargo prior to
departure from the United States. The 2H Documentation holds
automatically generated by ACE do not require any action or response
from CBP or CBP officers and only affect rail carriers or
[[Page 55190]]
their agents. The integrated system assists CBP in its risk assessment
efforts and the identification of high-risk cargo. If during the
integrated systems risk assessment, a potential high-risk cargo is
identified, then a 1H Enforcement hold is generated which requires a
CBP officer to conduct a review of the export manifest data
transmitted.\20\ The rail carriers are notified of these holds through
the integrated system which lets them know if a mandatory examination
of the cargo and or freight car is required or if CBP needs to conduct
further review of the data transmitted. These holds can be issued and
addressed even after rail carriers load the cargo. If a 1H Enforcement
hold is issued to a rail carrier after loading the cargo and CBP
requests to inspect the cargo, the rail carrier must provide CBP with a
location where CBP can conduct a proper examination. In addition to
holds, if a CBP officer determines during review that cargo or a rail
car may contain a potential threat to the train and its vicinity, a Do-
Not-Load (DNL) instruction is issued, which prohibits the rail carrier
from transporting that cargo or rail car. The rail carrier should not
transport any cargo or rail car with a DNL. The transmission of EEM
data in advance would help CBP review, and issue holds before cargo is
loaded or before a train reaches the U.S. port of export. This
transmission facilitates a more efficient export process by reducing
the likelihood of a freight car or cargo being removed from a
constructed train and the resulting delays when departing the U.S. port
of export.
---------------------------------------------------------------------------
\20\ CBP officers can also issue 1H Enforcement holds during
manual review of electronic export manifest data transmitted.
---------------------------------------------------------------------------
Rail carriers participating in the Test provided a number of
mandatory and conditional data elements electronically to CBP via ACE.
CBP determined that the selected data elements (listed below) would
provide the information necessary to conduct proper cargo security
enforcement. Rail carriers were already providing these data elements
by the time of departure from the U.S. port of export to CBP prior to
the Test but in paper form within the finalized train consists. The
Test also required participating rail carriers to submit these data
elements at the lowest bill level possible. The necessary data elements
CBP selected during this initial phase of the Test, including empty
rail cars, consisted of the following:
(1) Mode of Transportation (containerized rail cargo or non-
containerized rail cargo)
(2) Port of Departure from the United States
(3) Date of Departure \21\
---------------------------------------------------------------------------
\21\ CBP defines this data element as the date the train departs
the United States; the date the train crosses the international
border.
---------------------------------------------------------------------------
(4) Manifest Number
(5) Train Number
(6) Rail Car Order
(7) Car Locator Message
(8) Hazmat Indicator (Yes/No)
(9) 6-character Hazmat Code (conditional) (If the hazmat indicator is
yes, then UN (for United Nations Number) or NA (North American Number)
and the corresponding 4-digit identification number assigned to the
hazardous material must be provided.)
(10) Marks and Numbers
(11) SCAC (Standard Carrier Alpha Code) for exporting carrier
(12) Shipper name and address (For empty rail cars, the shipper may be
the railroad from whom the rail carrier received the empty rail car to
transport.)
(13) Consignee name and address (For empty rail cars, the consignee may
be the railroad to whom the rail carrier is transporting the empty rail
car.)
(14) Place where the rail carrier takes possession of the cargo
shipment or empty rail car
(15) Port of Unlading
(16) Country of Ultimate Destination
(17) Equipment Type Code
(18) Container Number(s) (for containerized shipments) or Rail Car
Number(s) (for all other shipments)
(19) Empty Indicator (Yes/No)
Additionally, if the rail carrier identified that the rail car is
not empty (empty indicator is no), then CBP also required information
for the following data elements for non-empty rail cars, as applicable:
(20) Bill of Lading Numbers (Master and House)
(21) Bill of Lading Type (Master, House, Simple or Sub)
(22) Number of house bills of lading
(23) Notify Party name and address (conditional)
(24) AES Internal Transaction Number or AES Exemption Statement (per
shipment)
(25) Cargo Description
(26) Weight of Cargo (may be expressed in either pounds or kilograms)
(27) Quantity of Cargo and Unit of Measure
(28) Seal Number
(29) Split Shipment Indicator (Yes/No)
(30) Portion of split shipment (e.g., 1 of 10, 4 of 10, 5 of 10--Final,
etc.) (conditional)
(31) In-bond Number (conditional)
(32) Mexican Pedimento Number (only for shipments for export to Mexico)
(conditional)
After the initial two-year period, CBP determined that the initial
phase of the Test had been feasible and functional for participating
rail carriers to provide EEM data and therefore CBP extended the Test
in 2017. At that time, CBP expanded the Test and made it available to
all rail carriers and other trade members (beyond the initial nine rail
carrier limit) which met the eligibility criteria.\22\ After the first
two years of the Test, CBP received feedback from rail carriers from
the Commercial Customs Operations Advisory Committee (COAC), which
stressed that rail carriers may not have access to certain export
manifest data elements requested by CBP two hours prior to loading of
cargo. Therefore, CBP determined to change the filing condition for
nine of the pre-departure export manifest data elements for the Test
moving forward. As part of the Test extension, CBP separated EEM data
elements into three categories, mandatory, conditional, and optional
data, and requested this information for all cargo and empty rail cars,
at least two hours prior to loading of the cargo. CBP changed the
following pre-departure EEM data elements (which were originally
mandatory) to optional for the Test extension.
---------------------------------------------------------------------------
\22\ Limited to those parties able to electronically transmit
manifest data in the identified acceptable format. Prospective ACE
Export Manifest for Rail Cargo Test participants must have the
technical capability to electronically transmit data to CBP and
receive response message sets via Cargo-ANSI X12 (also known as
``Rail X12'') or Unified XML and must successfully complete
certification testing with their client representative. Once parties
have applied to participate, they must complete a test phase to
determine if the data transmission is in the required readable
format. Applicants will be notified once they have successfully
completed testing and are permitted to participate fully in the
Test. In selecting participants, CBP takes into consideration the
order in which the applications are received.
<bullet> Mode of Transportation (containerized rail cargo or non-
containerized rail cargo) (Original Data Element #1)
<bullet> Place where the carrier took possession (Original Data Element
#14)
<bullet> Country of Ultimate Destination (Original Data Element #16)
<bullet> Equipment Type Code (Original Data Element #17)
<bullet> Number of house bills of lading (Original Data Element #22)
<bullet> Split Shipment Indicator (Original Data Element #29)
<bullet> Portion of split shipment (Original Data Element #30)
<bullet> Mexican Pedimento Number (Original Data Element #32)
[[Page 55191]]
CBP also modified the Test by changing the following data element
from mandatory to conditional:
<bullet> Marks and Numbers (Data Element #10)
CBP has continuously extended or renewed the Test to gauge the
functionality and feasibility of implementing the requirement of
providing EEM data to CBP prior to a train's departure. CBP believes
that the Test has been successful and, through this rulemaking, CBP
will now make the transmission of pre-departure EEM data mandatory for
all cargo departing the United States in the rail environment.
The ACE Export Manifest for Rail Cargo Program
This final rule will mandate the transmission of EEM data for all
cargo prior to departing the United States in the rail environment in
lieu of paper submissions, see Section V `Discussion of the Final Rule'
above for discussion on the regulatory requirements of this final rule.
CBP anticipates that requiring the transmission of pre-departure EEM
data will significantly improve CBP's ability to conduct proper cargo
security, prevent smuggling, and aid in facilitating a more effective
and efficient trade process. Under this final rule, the parties most
likely to have the correct data on rail export cargo will be able to
provide it to CBP through ACE. The experience and knowledge CBP gained
during the Test influenced CBP to change some of the requirements for
providing EEM data in this final rule.
CBP evaluated the time frames for electronic manifest data
transmission during the Test, the most important data elements needed
for risk assessment and screening cargo, and the unavailability to rail
carriers of certain data elements at given time frames and decided to
group the rail EEM data elements based on the deadlines for
transmission of data and on which party likely has the correct
information to provide the export manifest data. This final rule will
allow rail carriers, carriers' agents, NVOCCs, freight forwarders,
customhouse brokers (CHB), or anyone with direct knowledge of the
export manifest data to provide specific pre-departure export manifest
data to CBP, using CBP's ACE as a data transmission portal. This final
rule mandates that a party transmitting any specific EEM data must have
a bond on file with CBP that secures the obligation to transmit EEM in
the time and manner required by regulation. Additionally, the party
that transmits any EEM data electronically to CBP is also the
responsible party for addressing any questions, issues, instructions,
or holds resulting from CBP's review of that specific data.\23\ In the
NPRM, CBP suggested requiring the party transmitting the EEM data to
provide a telephone number and email address that will be monitored 24
hours per day and seven days a week. However, CBP received a number of
public comments suggested that the 24 hours a day, seven days a week
requirement would place an unfair burden, specifically on smaller trade
members and therefore CBP removed the requirement of providing a 24-
hour monitored telephone number and email address in this final rule.
CBP anticipates that ACE will electronically and automatically notify
whoever has transmitted rail EEM data to CBP.
---------------------------------------------------------------------------
\23\ CBP notes that the rail carrier will always be noticed of a
DNL or Hold even in the instance that another party was the EEM data
transmitter.
---------------------------------------------------------------------------
To improve CBP's risk assessment and screening efforts using pre-
departure EEM data, this final rule will require an initial filing of
seven mandatory data elements, which must be transmitted to CBP by any
eligible party at least 24 hours prior to the departure from the U.S.
port of export, and one conditional data element that must be
transmitted as soon as applicable.\24\ The rail carrier is responsible
for providing the initial filing data elements to CBP if no other
eligible party elects to transmit the data. Eligible parties should
transmit all other pre-departure EEM data elements to CBP no later than
two hours prior to departure from the U.S. port of export, except for
data on empty containers which will be required upon assembly of the
train. From CBP's experience during the Test, CBP does not anticipate
that changing the time frames for data transmission in this final rule
will cause any data transmission issues for parties transmitting the
information.\25\ Depending on the party providing the EEM data, the
required export data may be available at different points in time
during the export rail transaction process. Some rail carriers will
have the export manifest data available days in advance prior to
departure and therefore will have all the necessary information to
transmit the initial filing data to CBP and all other export manifest
data well in advance of the 24-hour and 2-hour prior to departure
deadlines.\26\ CBP anticipates that all rail carriers will likely
obtain the necessary export data elements to provide the required
transportation and cargo EEM data within the two-hour prior to
departure deadline.\27\ CBP received a public comment stating that
CBP's assumption of high compliance from rail carrier when requesting
data 24 hours in advance is overestimated because the Test was flawed
based on limited participation. The commenter suggests that CBP's
assumptions are based on the rail EEM Test which did not receive rail
EEM data at some of the more difficult ports of export, and it would be
difficult in some situations to provide rail EEM data 24 hours in
advance, and the commenter suggests all data should be transmitted 2
hours in advance. CBP agrees with the comment that every U.S. port of
export in the rail environment is unique and creates different
challenges, but CBP based its assumptions for data availability on
feedback from rail EEM Test participants that voluntarily provided rail
EEM Test data at ports of exports that they wished.\28\ Additionally,
in the NPRM, CBP acknowledged that rail carriers may need to make
changes stating that some rail carriers acquiring the necessary data
for the initial filing 24 hours prior to departure may require a change
in business practices and additional coordination with other trade
members or parties that have the required export manifest data. See 90
FR at 2886. As CBP wrote in the NPRM, CBP does not believe that in such
instances the export manifest data does not exist, rather, the other
trade members have not yet provided this information to the rail
carrier.\29\ CBP expects that in such instances, the costs to rail
carriers to obtain this information from other trade members a few
hours earlier will be minimal. Additionally, if other trade
[[Page 55192]]
members are reluctant to provide this information to rail carriers
within the 24-hour prior to departure deadlines, the other trade
members will be able to transmit this data to CBP directly as a
participant of the rail EEM.
---------------------------------------------------------------------------
\24\ Based on feedback CBP obtained from public comments
following the NPRM, CBP decided to change one of the initial filing
data elements from mandatory to conditional (all other data elements
are mandatory), that data element is expected to be provided if it
exists at the time of initial filing, if not then it will be
provided in the mandatory export cargo data.
\25\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
\26\ CBP obtained feedback and information from Trade members on
when in the export transaction process, the export manifest data is
typically available for them to submit to CBP. Information obtained
in February 2023.
\27\ CBP obtained feedback and information from Trade members on
when in the export transaction process, the export manifest data is
typically available for them to submit to CBP. Information obtained
in February 2023.
\28\ After the rail EEM Test was extended in 2017, CBP did not
put any limits on the trade members that could participate or which
ports of export the participants should provide rail EEM data for
departing trains. CBP only received rail EEM test data based on what
voluntary participants were willing to provide.
\29\ Information provided during discussion with some Trade
members in regard to the timeline for when export manifest data is
available to provide to CBP and challenges to providing pre-
departure data well in advance. Data obtained in February 2023.
---------------------------------------------------------------------------
CBP notes that during the Test, participants were already providing
most of the data required in the initial filing well in advance of
departure and more than 24 hours prior to departure.\30\ CBP expects
that rail carriers and other trade members will have access to most
export manifest data early in the planning stages of an export rail
cargo transaction and will be able to comply with these time frames.
Additionally, participating parties will be able to transmit EEM data
to CBP on a flow basis whenever it becomes available to help facilitate
CBP's review of the export data and the overall export process. CBP
anticipates that these time frames will provide CBP with adequate time
to perform proper risk assessment and identify any cargo that CBP needs
to examine, early enough in the supply chain to enhance security while
minimizing disruption to the flow of goods. Upon transmission of the
initial filing, CBP will validate or notify the party responsible of
any holds or DNLs. The party that transmits the data is responsible for
providing answers and updates on the data to CBP but the ultimate
responsibility to load, hold, or not load cargo falls on the rail
carrier.\31\
---------------------------------------------------------------------------
\30\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on August 2, 2022.
\31\ CBP notes that the rail carrier will always be notified of
any Hold or DNL even in the case that they were not the EEM data
transmitter.
---------------------------------------------------------------------------
Of the mandatory data elements CBP selected for the initial filing,
six were part of the mandatory data elements in the Test; however, CBP
revised the descriptions of these elements in this final rule to
provide additional clarity on the data required. Based on feedback CBP
obtained from public comments during the NPRM, CBP revised some data
elements, including the data element ``AES Exemption Statement, as
applicable'' to ``AES (AES) Internal Transaction Number (``ITN'') or
FTR exemption/exclusion code'', and this data element will be
conditional in the initial filing in this final rule. Additionally, to
provide additional clarity, CBP removed identification numbers as
acceptable data as proposed during the NPRM for the shipper's complete
name and address and the consignee's complete name and address and
created a new data element `Employer Identification Number (EIN) or
Importer Record Number or CBP assigned number' as a mandatory data
element for the initial filing for this final rule. The mandatory
initial filing data elements required in this final rule include the
following, listed as well are the data elements' corresponding
descriptions during the Test:
(1) Mandatory Data
(i) Bill of lading number,
(ii) The numbers and quantities of the cargo laden aboard the train
as contained in the carrier's bill of lading, either master or house,
as applicable (this means the quantity of the lowest external packaging
unit; the numbers or quantities of containers and pallets do not
constitute acceptable information; for example, a container holding 10
pallets with 200 cartons should be described as 200 cartons [Test data
element of Quantity of Cargo and Unit of Measure],
(iii) Total weight of cargo expressed in pounds or kilograms [Test
data element of Weight of Cargo (may be expressed in either pounds or
kilograms)],
(iv) A precise cargo description (or the Harmonized Tariff Schedule
(HTSUS) number(s) to the 6-digit level under which the cargo is
classified if that information is received from the shipper and weight
of the cargo); or for a sealed container, the shipper's declared
description and weight of the cargo (generic descriptions, specifically
those such as ``FAK'' [``freight of all kinds''], ``general cargo'',
and ``STC'' [``said to contain''] are not acceptable) [Test data
element of Cargo Description],
(v) The shipper's complete name and address, from the bills of
lading (for each house bill in a consolidated shipment) [Test data
element of Shipper name and address],
(vi) The consignee's complete name and address, from the bill(s) of
lading (The consignee is the party to whom the cargo will be delivered
in a foreign country. However, in the case of cargo shipped ``to order
of [a named party],'' the ``to order'' party must be named as the
consignee; and if there is any other commercial party listed in the
bill of lading for delivery or contact purposes, the carrier must also
report this other commercial party's identity and contact information
including address in the ``Notify party'' field.) [Test data element of
Consignee name and address], and
(vii) Employer Identification Number (EIN) or Importer Record
Number or CBP assigned number.
Additionally, CBP is adding one conditional data element be
provided at the time of the initial filing, if applicable.
(2) Conditional Data
Automated Export System (AES) Internal Transaction Number (``ITN'')
or FTR exemption/exclusion code [Test data element AES Exemption
Statement (per shipment)].
In this final rule, CBP groups the remaining rail EEM data elements
based on CBP's understanding of which parties may have the best
knowledge of the export manifest data elements. CBP categorizes these
remaining data elements as export manifest transportation data, export
manifest cargo data, and empty container data. According to this final
rule, the rail carrier or its agent is responsible for transmitting to
CBP the EEM data on any empty container rail cars.\32\ This data must
be transmitted electronically no later than the time of assembly of the
train. For EEM transportation data, the rail carrier or its agent must
also transmit this data at least two hours prior to departure from the
U.S. port of export. The rail carrier or its agent is responsible for
providing the following EEM transportation data elements to CBP in this
final rule:
---------------------------------------------------------------------------
\32\ If applicable, empty container rail car data would be
included in the Train Consist data element of the mandatory data
elements for transportation data. Empty containers are listed in the
train consist and do not require any additional data to be provided
as per this rule.
---------------------------------------------------------------------------
Mandatory Elements
(1) Port of departure from the United States
(2) Date of departure \33\
---------------------------------------------------------------------------
\33\ CBP clarifies that this data element means the date the
train departs the United States; the date the train crosses the
international border.
---------------------------------------------------------------------------
(3) Estimated time of departure \34\
---------------------------------------------------------------------------
\34\ CBP clarifies that this data element is the estimated time
the train departs the United States; the time the train crosses the
international border.
---------------------------------------------------------------------------
(4) Carrier-assigned conveyance name, equipment number and trip number
(5) Train Consist, which includes: (A) manifest number, (B) train
number, (C) rail car order, and (D) empty containers (if applicable)
(6) The rail carrier identification SCAC code (the unique Standard
Carrier Alpha Code assigned for each carrier by the National Motor
Freight Traffic Association; see Sec. 4.7a(c)(2)(iii) of this chapter)
(7) Container or equipment numbers (for containerized shipments) or
Rail Car Numbers (for all other shipments)
(8) Employer Identification Number (EIN) or Importer Record Number or
CBP assigned number
Conditional Elements
(1) 6-character Hazmat Code. (If the Hazmat indicator is yes, then UN
[[Page 55193]]
(for United Nations Number) or NA (North American Number) and the
corresponding 4-digit identification number assigned to the hazardous
material must be provided)
(2) Marks and Numbers
(3) Seal number (only required if container was sealed.) \35\
---------------------------------------------------------------------------
\35\ The seal numbers for all seals affixed to containers and/or
rail cars to the extent that CBP's data system can accept this
information (for example, if a container has more than two seals,
and only two seal numbers can be accepted through the system per
container, electronic presentation of two of these seal numbers for
the container would be considered as constituting full compliance
with this data element).
---------------------------------------------------------------------------
Optional Elements
(1) Mode of transportation (containerized rail cargo or non-
containerized rail cargo)
(2) Equipment type code
(3) Place where the rail carrier takes possession of the cargo shipment
or empty rail car
CBP provides additional flexibility in this final rule by allowing
any eligible party with the most direct information to provide EEM
cargo data to CBP two hours prior to departure from the U.S. port of
export. However, the rail carrier or its agent may also elect to
transmit the mandatory EEM cargo data and in the case that no other
party elects to provide the required EEM cargo data, it is the rail
carrier's responsibility to provide this EEM cargo data to CBP.\36\ The
following data elements comprise the CBP-requested EEM cargo data for
rail EEM in this final rule. CBP notes that if the data was provided
during the initial filing it does not need to be transmitted again
unless there are updates or changes made to the data.
---------------------------------------------------------------------------
\36\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
---------------------------------------------------------------------------
Mandatory Elements
(1) Shipper name and address (For empty rail cars, the shipper may be
the railroad from whom the rail carrier received the empty rail car to
transport.)
(2) Consignee name and address (For empty rail cars, the consignee may
be the railroad to whom the rail carrier is transporting the empty rail
car.)
(3) Port of lading
(4) Port of unlading
(5) Bill of lading type (Master, House, Simple or Sub)
(6) Bill of lading numbers (Master, House, Simple or Sub)
(7) AES (ITN) or In-bond number (per shipment)
(8) Cargo description
(9) Weight of cargo (may be expressed in either pounds or kilograms)
(10) Quantity of cargo and unit of measure
(11) Employer Identification Number (EIN) or Importer Record Number or
CBP assigned number.
Conditional Elements
(1) In-bond type
(2) Notify party name and address
(3) Secondary notify party name and address
Optional Elements
(1) Mexican Pedimento Number (only for shipments for export to Mexico)
(2) Secondary notify party SCAC
(3) Country of ultimate destination
(4) Number of house bills of lading
When participants transmit the EEM cargo and transportation data to
CBP via ACE, CBP will validate or notify the responsible party of any
holds. Additionally, a CBP officer will review the finalized train
consist prior to the train's departure from the U.S. port of export.
CBP anticipates that obtaining this data through the integrated system
will help CBP work with rail carriers and other parties to address
almost all issues identified during the CBP review before the train
reaches the U.S. port of export and possibly before loading of the
cargo. This will significantly reduce any delays at the U.S. port of
exports in instances where CBP officers conduct review and address
issues while the train is at the U.S. port of export. CBP anticipates
that through the obtaining of pre-departure rail EEM data, CBP officers
will be able to conduct the appropriate risk assessment and screening
and complete their review of all export manifest data prior to a
train's arrival at the U.S. port of export.\37\
---------------------------------------------------------------------------
\37\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on November 8, 2022.
---------------------------------------------------------------------------
In the initial Test, CBP requested that 32 data elements be
transmitted two hours prior to the cargo loading. The experience gained
during the Test has allowed CBP to revise which data elements should be
mandatory, conditional, optional, and unnecessary. Of the original 32
data elements put forth in the initial Test, five data elements were
determined by CBP to be unnecessary and CBP no longer requests these
EEM data elements in this final rule. CBP lists these below.
(1) Car Locator Message
(2) Empty Indicator (yes/no)
(3) Hazmat Indicator
(4) Split Shipment Indicator (Yes/No)
(5) Portion of split shipment (e.g., 1 of 10, 4 of 10, 5 of 10--Final,
etc.)
As an enforcement tool, this final rule provides CBP with authority
to impose liquidated damages on parties that do not provide the
mandatory EEM data in the manner and in the time frame required. CBP
may assess liquidated damages when a violation occurs. Any party that
violates the requirements for data transmission as described above in
this final rule is subject to liquidated damages of $5,000 for each
violation and up to a maximum of $100,000 per departure. Although there
is the possibility for liquidated damages, compliance is CBP's goal and
CBP aspires to work alongside rail carriers and other parties to ensure
that trade members provide the proper data in a timely manner, so that
CBP can properly review the data, conduct risk assessment, identify
high-risk shipments, and enforce U.S. export laws and regulations on
U.S. rail exports.\38\
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\38\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
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Time Periods of Analysis
This analysis primarily focuses on the potential impacts of this
final rule after it will be in effect, but it also includes a
discussion of the impacts during the Test that was in place before the
final rule is finalized. The costs, cost savings and benefits of the
Test are sunk (already incurred and cannot be recovered) for the
purpose of deciding whether to proceed with the final rule, but they
are important for understanding the full costs and benefits of
implementing the rail EEM as a whole. To give the reader a full view of
the effects of CBP's requiring rail EEM data throughout the entire span
of time, CBP analyzes the effects of implementing rail EEM collection
over two time periods comparing each time period to the baseline
scenario that existed prior to the rail EEM Test. First, CBP analyzes
the effects from Test used for the collection of pre-departure manifest
data on rail exports during the pilot period, fiscal years 2016-
2025.\39\ Second, CBP analyzes the effects of the final rule which will
mandate the transmission of EEM data in the rail environment during the
five-year regulatory period, beginning in fiscal year 2026 and ending
in fiscal year 2030. For the regulatory period, CBP estimates, to the
extent data is available, the additional total projected costs, cost
[[Page 55194]]
savings and benefits to the Federal government, rail carriers and other
trade members as a result of requiring the transmission of EEM data for
trains departing the United States, compared to the baseline scenario.
In the analysis for this final rule, CBP defines the pilot period as
fiscal years 2016-2025 and the regulatory period as fiscal years 2026-
2030. At the conclusion of the analysis, CBP includes tables showing
the effects of the final rule across both periods--effectively showing
the full results of the pilot and the final rule against the baseline
(the world without the rail EEM Test). While CBP provides information
about the two time periods separately for full transparency and to make
clear which costs are sunk and which are incremental to this final
rule, CBP also sums the two time periods for a full accounting of the
effects of the rail EEM program as a whole. Additionally, all
references to years are for fiscal years unless otherwise noted.
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\39\ CBP anticipates that the Test would still be active until
fiscal year 2026 when the final rule will be implemented; however,
at the time this analysis was written CBP only had actual data up
through fiscal year 2024. Therefore, CBP provides estimates, not
actual data, for the fiscal year 2025 in this analysis. CBP compares
the costs, cost savings and benefits during the Test to the baseline
scenario, CBP assumes these effects to be sunk and are not
incremental to this rule.
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Population Affected by Rule
CBP expects that this final rule will affect a number of different
parties. During the regulatory period, as the transmitting of EEM data
expands, CBP expects broader effects on rail carriers, other trade
members (such as USPPIs, FPPIs, NVOCCs, freight forwarders, customhouse
Brokers (CHB), or other parties with knowledge of manifest data
elements), CBP, and other Federal government agencies that oversee U.S.
exports. CBP expects that this final rule will affect all seven rail
carrier companies currently exporting cargo from the United States by
rail. Although CBP does not have the necessary data to provide an exact
estimate for how many other trade members this final rule will affect,
CBP acknowledges that this final rule could result in some minor
effects to a large number of other trade members, specifically in case
they elect to provide EEM data directly to CBP via ACE. CBP expects
that this final rule will also improve the facilitation of the export
process at around 68 U.S. ports of export, currently conducting the
exportation of goods from the United States in the rail environment.
Because the Test was limited in scope, the effects were largely
experienced by a few rail carriers, possibly some other trade members
and CBP during the pilot period. Although CBP only made the initial
Test available to nine carriers, CBP then extended the Test to all
eligible parties; however, only two rail carriers actively participated
in the Test. The two rail carriers participating in the rail EEM Test
have similar business characteristics to the remaining rail carriers
that will be affected by this final rule. All are large carriers that
operate internationally. Therefore, CBP anticipates that the effects on
the rail carriers participating in the rail EEM Test accurately
represent the effects that the remaining rail carriers will experience
from this final rule.
Rail EEM Test Data and Export Rail Projections
In the analysis for the NPRM, CBP was able to identify the number
of export manifest data transmissions and train consists transmitted
electronically by participating rail carriers during the Test from
2016-2023. Since the NPRM was published, CBP now has data from rail EEM
test for 2024 and CBP has adjusted its estimates in this analysis for
the final rule to reflect this new data. Because CBP's pilot period
includes a future year, CBP does not have actual Test data available
for 2025. To address this issue CBP provides an estimate for the final
year of the pilot period. This estimate is based on actual data in
previous years. From 2016-2024 rail EEM Test participants provided a
total of 1,756,481 export manifest data transmissions and 13,618 train
consists electronically to CBP via ACE.\40\ To estimate the number of
export manifest data transmissions that will occur during the final
year of the pilot period CBP used the average number of rail EEM data
transmissions from 2017-2024 (208,920) and the average number of train
consists submitted electronically to CBP from 2021-2024 (3,011).\41\
According to CBP's projections for the final year of the pilot period
and the actual data obtained (2016-2024), CBP expects that during the
entire pilot period rail EEM Test participants will transmit around
1,965,401 export manifest data transmissions and 16,629 electronic
train consists. Total electronic data transmissions to CBP from
participants in the rail EEM Test would be 1,982,029 during the pilot
period.\42\ Table 2 below displays CBP's actual and estimated number of
export manifest data transmissions and train consists transmitted
electronically to CBP during the pilot period.
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\40\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 10, 2024, and May 6, 2025. Data obtained from
CBP's ACE.
\41\ CBP excluded 2016 from the average for export manifest data
transmissions due to lack of participation in that year. CBP used
only four years of data 2021-2024 for the electronic train consists
transmitted, because these were the only full years of data during
the pilot period when all train consists were actually transmitted
by participating rail carriers in the Test.
\42\ This number represents the total number of electronic
transmissions sent to CBP by rail EEM test participants (export
manifest data transmissions + electronic train consists).
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[[Page 55195]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.005
Unfortunately, outside of the limited EEM data provided by Test
participants, all other export rail data (excluding data for EEI
requirements) submitted by rail carriers was on paper forms and
therefore CBP was unable to obtain actual rail export volumes (by train
or by train car). Therefore, CBP used train import volume data as a
proxy for train export volume data to calculate the possible number of
EEM data transmissions as a result from this final rule during the
regulatory period. CBP anticipates that the number of train cars
entering the United States from rail imports is likely comparable to
the number of train cars exiting the United States for rail
exports.\43\ CBP used existing internal data on inbound train cars to
project the volume of outbound train cars during the final year of the
pilot period and the regulatory period. Inbound train car volumes have
been largely consistent from 2017-2024 and CBP anticipates that on
average, rail volume should remain relatively constant in future years
as compared to the volumes recorded over the past eight years.
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\43\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on June
21, 2022. CBP used car volume instead of train volume because import
volumes by train would be inaccurate since they tracked by rail car
fee payments which are capped per year.
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CBP estimates that from 2016-2024 there were a total of around 39.5
million train cars departing the United States, or on average 4.4
million each year.\44\ Because CBP anticipates that the outbound train
volume will remain relatively constant during future years, CBP used
the average number of estimated outbound train cars during 2017-2024
(4.2 million) for the number of expected outbound train cars for each
future year.\45\ Although CBP has data available on the number of train
cars, CBP does not know how many actual trains will engage in exporting
goods in the rail environment during the regulatory period. Therefore,
CBP does not know exactly how many train consists rail carriers will
transmit requiring a CBP officer to review each year during the
regulatory period. To provide an estimate for how many train departures
will likely be involved in exporting goods in the rail environment
during the regulatory period, CBP used Test data from 2021-2024 on the
number of simple bills transmitted compared to the number of train
consists transmitted. Over the course of these four years a total of
826,123 simple bills and 12,042 train consists were electronically
transmitted to CBP as part of the Test, or on average approximately
68.6 simple bills per train consist.\46\ CBP used this ratio of simple
bills (train cars) to train consists (trains) and the expected outbound
train cars to estimate the total number of trains that will transmit
electronic train consists when exporting goods from the United States
during future years.
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\44\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 9, 2024, and May 5, 2025. Data obtained from
CBP's Borderstat and OMR databases on inbound rail statistics from
FY 2017-FY 2024.
\45\ Inbound rail volume decreased significantly between 2016 to
2017 and volume remained relatively the same between 2017-2024.
Therefore, CBP omitted the 2016 inbound rail volumes for the
estimate for the regulatory period volume because CBP expects this
would have skewed the annual volume upward.
\46\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, May 10, 2024, and May 6, 2025. Data obtained from
CBP's ACE. CBP used only three years of data 2021-2024, because
these were the only full years of data during the pilot period when
all train consists were actually transmitted by participating rail
carriers in the Test. Additionally, CBP notes that most of the time
the ratio of a simple bill to train car is one to one, however a
simple bill could be transmitted for multiple train cars or vice
versa. Because CBP only knows the number of simple bills transmitted
during the Test and not the number of train cars, CBP assumes in
this analysis that the ratio of a simple bill to train car is one to
one, essentially the number of simple bills represents the number of
train cars.
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CBP anticipates that each year during the regulatory period,
approximately 4,220,861 train cars and 58,194 trains will depart the
United States requiring the transmission of export manifest data. In
total CBP expects that during the regulatory period, rail EEM
participants will transmit approximately 21,395,279 data transmissions
to CBP or around 4,279,056 annually. Table 3 below displays CBP's
estimate for total outbound train cars and trains during 2016-2024 and
projected outbound train cars and trains for the final year of the
pilot period and the regulatory period, and the estimated total EEM
data transmissions during the regulatory period.
[[Page 55196]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.006
In addition to the number of export manifest data transmissions and
train consists transmitted electronically from 2016-2024, CBP also
obtained information from the Test on the number of 2H Documentation
and 1H Enforcement holds that were issued during these years. According
to CBP internal data as part of the rail EEM Test from 2016-2024 CBP
issued a total of 51,040 2H Documentation holds and 1,188 1H
Enforcement holds.\48\ To determine the number of holds that will be
issued by CBP in the final year of the pilot period CBP used the
percent of export manifest data transmissions that resulted in a 2H
Documentation or a 1H Enforcement hold from 2020-2024. Based on the
information obtained during the Test, on average a 2H Documentation
hold was issued on approximately 5.0 percent of all export manifest
data transmissions and on average a 1H Enforcement hold was issued on
0.10 percent of all export manifest data transmissions. To estimate the
number of holds issued in 2025 CBP multiplied the percentage of EEM
data transmissions resulting in a 2H Documentation hold (5.00%) and 1H
Enforcement hold (0.10%) by the expected total number of rail EEM data
transmissions for 2025 (see Table 2). CBP anticipates that during the
pilot period CBP will issue around 61,621 2H Documentation holds and
around 1,405 1H Enforcement holds.
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\47\ To estimate the number of total outbound train cars in
future years, CBP used the average volume of train cars during the
seven year period (2017-2024) = 4,220,861 annually.
\48\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
December 6, 2022, and May 10, 2024. Data obtained from CBP's ACE.
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CBP expects that these holds will be issued at a similar frequency
during the regulatory period. Therefore, to estimate the number of CBP
holds that will be issued during the regulatory period, CBP multiplied
the percentage of data transmissions that will be issued 2H
Documentation holds (5.00%) and 1H Enforcement holds (0.10%) by the
estimated number of total data transmissions (see Table 3), for each
year of the regulatory period. According to CBP's estimates, CBP will
issue a total of 1,068,148 2H Documentation holds or on average 213,630
annually and around 21,890 1H Enforcement holds or on average 4,378
annually during the regulatory period. Table 4 displays CBP's estimates
for total holds that will be issued during the regulatory period.
[[Page 55197]]
[GRAPHIC] [TIFF OMITTED] TR26AU26.007
CBP believes that it is possible that the total number of holds
could be less than these estimates during the regulatory period as rail
carriers and other trade members become more familiar and efficient at
providing the pre-departure EEM data, potentially improving compliance
and limiting the number of holds CBP issues. CBP did not issue any DNL
holds during the Test and does not expect a significant number of DNL
holds to be issued during the regulatory period. If DNL holds are
issued this will be an additional cost to rail carriers, who are
ultimately responsible for loading and not loading cargo.
Pilot Period
Costs
CBP expects that CBP, participating rail carriers, other trade
members incur some costs during the pilot period when compared to the
baseline.\49\ CBP's primary cost during the pilot period was from
implementing the Test EEM data tool into ACE. ACE was already in place
prior to the Test; therefore, CBP did not need to develop an entirely
new system. However, there were some development and ongoing systems
costs to CBP during the introduction and operation of the Test.
Initially, CBP incurred systems costs of approximately $608,000 to
develop and implement the Test EEM tool into ACE.\50\ During the pilot
period, CBP incurs ongoing operations and maintenance costs associated
with the Test, which costs CBP on average approximately $101,350 each
year. CBP estimates that total systems costs to CBP for developing and
operating the Test will be approximately $1.6 million during the pilot
period.
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\49\ Other trade members would include USPPIs, FPPIs, NVOCCs,
freight forwarders, or other third parties with knowledge of
manifest data elements.
\50\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on December 7, 2022. Rail EEM
ACE cost estimates were provided by CBP's Office of Information and
Technology and provided development and ongoing costs that increase
at a fixed rate each year.
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CBP also incurs some time burdens while conducting additional
review of EEM data when compared to the baseline. As stated earlier, in
the baseline scenario the rail carriers provided export rail data to
CBP all at once in the finalized train consists at or prior to
departure from the United States. Therefore, under the baseline
scenario, CBP was unable to review export data until the finalized
train consist was submitted. During the Test, participants provided EEM
data on a flow basis, so CBP was able to review the data when
participants transmitted the EEM data and did not have to wait for rail
carriers to finalize all the data and submit it together in the train
consist. When participants transmit the EEM data to CBP via ACE, the
integrated system can identify potential high-risk cargo and issue a 1H
Enforcement hold, which requires manual review from a CBP officer. As
discussed earlier, 2H Documentation holds generated by ACE do not
require any action or response from CBP officers, therefore CBP does
not anticipate any time burden to CBP when a 2H Documentation hold is
issued. CBP estimates that this additional review of each 1H
Enforcement hold imposes an average time burden of approximately 5
minutes
[[Page 55198]]
(0.083 hours) to CBP officers.\51\ In addition to reviewing the EEM
data transmitted, CBP officers also incur time burdens when addressing
and resolving 1H Enforcement holds. Depending on the complexity of the
1H Enforcement hold, the time burden to CBP officers to address and
resolve these holds varies from a few minutes to a few hours if a hold
requires a CBP officer to manually examine cargo or a train car.\52\
CBP does not know how many issued 1H Enforcement holds result in cargo
examinations during the pilot period or if the Test led to additional
examinations when compared to the baseline scenario. However, CBP notes
that the majority of these 1H Enforcement holds do not result in a
cargo examination and CBP officers are able to address and resolve the
majority of these holds in a few minutes.\53\ CBP estimates that, on
average, CBP officers incur an additional time burden of 10 minutes
(0.167 hours) to address and resolve each 1H Enforcement hold.\54\ In
total, CBP expects on average a CBP officer incurs a time burden of
approximately 15 minutes (0.25 hours) to review and resolve each 1H
Enforcement hold.
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\51\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on August 2, 2022. 1H
Enforcement holds can also be issued by CBP officers upon manual
review of export manifest data.
\52\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on June 21, 2022.
\53\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, on November 8, 2022.
\54\ Information provided by CBP's Cargo and Conveyance
Security, Office of Field Operations, subject matter expert on
November 21, 2022. Data obtained from CBP's OMR database.
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During the pilot period, CBP estimates that rail carriers
transmitted a total of 1,982,029 EEM data submissions as part of the
Test, resulting in approximately 1,405 1H Enforcement holds issued
which required additional review by a CBP officer.\55\ CBP calculates
the time burden to CBP officers during the pilot period by multiplying
the estimated number of 1H Enforcement holds (1,405) by the expected
average time burden to CBP officers to review, address and resolve the
average 1H Enforcement hold (15 minutes, 0.25 hours). CBP expects that
CBP officers will have incurred a time burden of approximately 351
hours
[…truncated; see source link]Indexed from Federal Register on August 26, 2026.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.