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These comments are made on behalf of our client, the
JFK Airport Customs Brokers Association, Inc., which is
comprised of more than 170 licensed customs broker
companies located at and around JFK Airport. The customs
brokers located at Kennedy Airport handle in excess of 90%
of
all imported commercial merchandise passing through the
busiest airport in the world. The members of our client
are responsible for properly interpreting those laws
enforced by the U.S. Customs Service relating to the entry
of imported merchandise into the commerce of the United
States. In addition to those laws and regulations relating
specifically to U.S. Customs, the customs brokers are also
responsible for having a knowledge of those laws enforced
by the U.S. Customs Service on behalf of many other Federal
agencies, among which are the Food & Drug Administration,
the U.S. Department of Fish and Wildlife, the U.S.
Department of Agriculture, the U.S. Department of Defense
and the U.S. Department of State. The customs broker is a
licensed entity required to abide by the strict regulations

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promulgated and enforced by the U.S. Customs Service. customs broker is an integral and essential part of the import process. The broker is heavily relied on by the U.S. Customs Service to insure that proper documentation is submitted to U.S. Customs, enabling imported merchandise to enter the commerce of the United States.

Unfortunately, our client sees the efficiency and effectiveness of the U.S. Customs Service in a not SO positive posture. Our client questions whether monies allocated to the U.S. Customs Service over the past number of years has been properly spent by U.S. Customs, or whether it has been squandered away because of U.S. Customs failure to adequately analyize its instituting new practices and procedures prior to actual implementation. Many complaints have been made to members of the U.S. Congress in this regard. Such complaints have resulted in the announcement by the Honorable Dan Rostenkowski (D., Ill.), Chairman, Committee on Ways and Means, U.S. House of Representatives, in a press release dated January 27, 1987 that the Subcommittee on Oversight should review certain administrative practices relating to the U.S. Customs Service. Among those mentioned is the "consistency of the U.S. Customs Service in applying its rulings and determinations on the treatment of imports"; one of the reasons cited by our members as a cause for Customs' inefficiency is Customs lack of timely promulgation of regulations interpreting vague statutory language. The U.S. Customs Service has yet to promulgate regulations interpreting 19 USC 1484 relating to the "entry of merchandise and the right to make entry". The U.S. Customs Service's current interpretation disregards commercial reality and allows, contrary to statutory language and intent, non-owners and non-purchasers of

merchandise to appoint a customs broker to make entry of imported merchandise. This appointment contravenes the, many times, expressed desire of the actual owner or purchaser who desires either to prepare the entry documentation himself or to appoint another broker. Not only does this interfere with the established contractual relationship between importers and their customs brokers, but it opens the door for false and incomplete entry documentation, since the entity preparing the documentation has no relationship to the owner or purchaser and, thus, no access to accurate and complete information. This situation results in the deprivation of duties owed the Government and allows for the proliferation of contraband, contrary to the avowed of the U.S. Customs

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interpretation, allowing a nominal consignee designated on "master waybill" as opposed to the actual consignee designated on the underlying document (i.e. house waybill) also inhibits Customs from carrying out the mandates of 19 USC 1484 (a) (1) (D), which requires the establishment of procedures "which insure the accuracy and timeliness of import statistics, particularly statistics relevant to the classification and valuation of imports." Procedures currently in place which allow a non-interested party to hire a broker to make entry are contrary to the specific dictates to the aforementioned section of law.

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Commercial reality mandates that U.S. Customs accept house waybill or its equivalent in determining who the "consignee" is for purposes of making entry and appointing a customs broker. Until such change in Customs' thinking occurs, "couriers and express delivery services" will be to, either intentionally or unintentionally, controvert the intent of the Customs' laws with the unfortunate result, perhaps being, more instances of drugs or other contraband "innocently entering the country". It happened with Pan Am's trusted employees, it will also happen with the trusted employees of others who have close relationships with U.S. Customs officials in "hub cities".

Where there is no strict accountability, as there is with owners or purchasers and their appointed customs brokers, there is little incentive to produce correct and accurate entry documents. Any budget proposal should mandate expenditure of an appropriate amount for the immediate promulgation of requlations requiring that

Customs acknowledge that the house waybill or its equivalent be the designated document, when consolidated shipments are involved, to determine the identity of the consignee of imported merchandise.

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Another statutory provision enacted in 1983, which has yet to be interpreted by regulatory language is the "Convention on Cultural Property", 19 USC 2601 et sec. Although this provision has less general application than the previously cited statutory provisions, there is still a pressing need for agency interpretation of the statutory language SO that importers and their customs brokers are properly advised as to what cultural property can be legitimately imported into the United. States. Currenty, each importer must rely on the whims of the inconsistent interpretation of the statutory language existent at each port of entry. Such a situation 18 intolerable, contrary to the "uniformity" often espoused by Customs and an unintended impediment to valid importations. We could continue to list other situations where the lack of Customs uniformity has created doubt and inconsistency in the enforcement of Customs' laws, but since that factor is so widely known within the industry, it is almost entitled to "judicial notice"; this even in light of the fact that Customs has a "Customs Information Exchange" (CIE) which is available to all Customs officials nationwide and designed to promote consistency amoung the ports. Further, with Customs professing to be in the modern age with regard to automation, its failure to properly use the CIE brings into question whether the vast amounts spent by Customs on automation were put to good Customs has never been asked the hard question; Give us a breakdown over the last ten years, a line item breakdown, as to how much was spent on automation and a detailed analysis of how much was accomplished; How many

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programs were started and abolished; How many programs were started, which, in actuality, increased the cost to Customs or to the importing public. Customs should not be permitted to respond with generalized alleged positive result of automation obvious to the importing public.

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Customs has floundered in its attempt to automate. implemented procedures in various ports, including York, which are dependent upon automation, prior to

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automation being instituted within the port. These new procedures could have waited until the automation was in place. Instead, the changes of procedures which worked, have created additional delays and additional costs to the importing public with no upgrading of U.S. Customs efficiency. Onerecent example of such a change is the implementation of the Centralized Examination Facility at Kennedy Airport. Customs had promised faster processing of containerized cargo and more efficient operation. The theory behind the centralized facility and its efficient operation was, at least in part, based on the availability' of automation and telecommunication capability among all Instead, the centralized examination has resulted in delays in processing and highly increased costs for the importing public to such an extent that many importers are rethinking whether consolidation is economically feasible and whether, in fact, nonconsolidated parcels should be shipped directly with airlines, crowding their already crowded facilities. is even more disturbing is that Customs has recognized the delays and increased costs which have accompanied this new system, but has insisted on continuing to bring in containerized freight stations on a monthly basis. would think that good management would dictate a hold on adding new freight to a facility that is not working as promised.

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Customs', in creating the Centralized Examination Facility, has rid itself of a traditional function, that of being in charge of examining cargo and has, in fact, subcontracted out much of that function. The importers have no choice but to use that private facility. Ав result, the increased cost of the Customs' mandate should be borne by the U.S. Customs Service and paid for by the "user fees" collected by the U.S. Customs Service. This traditional examination function is one that is

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