By Bruce Leeds, Senior of Counsel, Braumiller Law Group
On Oct. 28, 2020, U.S. Customs and Border Protection (CBP) published an Advance Notice of Proposed Rulemaking on continuing education for individually licensed customs brokers. After receiving comments and feedback from the trade, CBP published a Notice of Proposed Rulemaking (NPRM) on this proposal on Sept. 10, 2021.
Many of the proposals in the Sept. 10 NPRM are the same or similar to those from last October; however, a major change was made in the number of continuing educational hours required of customs brokers. The hours were reduced from 40 to 36 over the triennial period.
According to CBP “Requiring more than 36 hours of continuing broker education per triennial period could be burdensome for the customs broker community (especially individual brokers operating as or working for small businesses) and a lower requirement would be insufficient to ensure that individual brokers keep abreast of changes in customs and related laws”
The rest of the proposed provisions may be the same as Oct. 10, but the difference is that after receiving public input CBP made only a few small changes. Customs brokers can expect the NPRM is getting closer to reality.
Training Reporting and Certification
The continuing education would be required of all individually licensed brokers with a few small exceptions. These are brokers who have voluntarily suspended their licenses, and individual brokers who have not held their license for an entire 3-year triennial period at the time the triennial report is due. If an individual reinstates his/her suspended license, the education requirement would be prorated for the remainder of the triennial period.
There is no training requirement for corporations or partnerships licensed as customs brokers.
In its proposal, CBP is requiring customs brokers to report and certify their compliance with the continuing educational requirement when they submit their triennial report. The report could be done online or in writing. There is no requirement to submit a detailed report of the education completed. Instead, brokers would retain detailed documentation supporting completion of the continuing education requirements. This includes:
- The date of the training
- The name of the provider or host
- The date(s) attended
- The number of hours accrued
- If in-person, the location of the training
- Any documentation from the provider showing registration and completion of the training
The latter could include receipts, copies of the training materials and completion certificates.
The customs broker would keep these records for a minimum of three years after the end of the triennial period. CBP would have the authority to request the training records and either view them in person or request that copies be sent to them.
If a broker did not report and certify his/her training, CBP would take a progressive disciplinary approach. First CBP would notify the individual of the noncompliance and allow them 30 days to submit training records and a corrected triennial report. If the broker did not complete the training they would need to do so and subsequently submit records with a corrected report.
If the broker did not respond within 30 days, CBP would suspend the broker’s license. CBP however would give the person an additional opportunity to complete and report the training. If the broker did not comply in 120 days, the license would be suspended with prejudice.
If the broker were to falsify the training record or submit false or misleading statements, CBP could act under Part 111.53 of the regulations to suspend or revoke the broker’s license.
Continuing education training could be provided by either or both of two sources. The first would be training offered by CBP. Training by other U.S. Government agencies would also count if it were relevant to CBP business. For example, a session on import requirements for food products offered by Food & Drug Administration would count toward the education hours. Training offered by non-government parties, such as schools, firms, and organizations, would only count if it were provided by an accredited provider. Accreditation would be provided by CBP-approved accreditors. As described in the Oct. 10 NPRM, accreditors would be selected by a Request for Information and Request for Proposal methods under the Federal Acquisition Regulations. CBP would not pay the accreditors selected but the accreditors could charge providers for accreditation services.
The accreditors would need to meet a number of requirements. They include:
- At least one key official with a customs broker license
- Knowledge of Customs and other related laws and regulations
- Professional references
- Resumes of key personnel
- Description of the process for receiving, processing and approving a request for accreditation
CBP is not planning to place a limit on the number of accreditors selected.
CBP will not grant credit for writing books or articles or for reading books or articles on Customs subjects. CBP will, however, grant credit to licensed brokers for time spent preparing training or presentations. The licensed individuals will be given one hour credit for each 60 minutes spent in preparation with a maximum of 12 hours per reporting triennial period. Any licensed speaker or instructor will need to obtain approval from an CBP-selected accreditor before the preparation time can be counted.
In the NPRM CBP set out key objectives for the accreditation program:
- Multiple approved accreditors, which will allow for competition and keep costs at market level without creating a monopoly;
- An open and transparent application process; and,
- An opportunity for small businesses, such as law firms that specialize in customs law, and non-profit organizations, such as trade associations, to become approved accreditors.
Comments and Next Steps
Members of the trade have 60 days from the date of the notice (Sept. 10, 2021) to submit written comments. Comments are submitted online via the portal at www.regulations.gov. Cite Docket No. USCBP 2021-0030.
After that CBP will read and respond to the comments and will likely publish a Proposed Rule in the Federal Register. The trade will have an opportunity to respond to that also. The last step will be a Final Rule, after which the final regulations will take effect and licensed brokers will need to comply with the rules. This will take a while to happen, but it looks like it will happen.
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