Customs Broker Verification of Importer’s Identity – Customs Proposed Rule

Customs has issued a Notice for Proposed Rule Making – Customs Broker Verification of Importer’s Identity.

C J International believes this proposed legislation will be an added burden on the brokers and clients by creating more work and added cost in time and money to all importers. As broker, we will be required to go through a labor intensive process to re-validate existing Powers of Attorney. As the importer/client, are you prepared to provide the information required if this legislation passes? We are seeking your help! Please read the Federal Register notice and submit your comments to Customs indicating why you believe this proposed legislation is not in your best interest. We can help you submit comments. Send them to us on your letterhead and we can forward them to the proper parties.

We will try and summarize things here: It is widely known that Customs brokers must have a valid broker’s license to transact Customs business on your behalf. We also know that a Customs broker must have a valid power of attorney (POA) to transact Customs business on behalf of the client.

Current regulations are that CBP gives the broker ‘non-binding’ guidance on how they can validate importers when they obtain a POA. They provide recommendations that whenever possible, we validate that Power by verifying certain information such as check the client’s website to verify the importers name, importer number, tax ID and business registrations with State authorities, among a few other things.

Under the Trade Facilitation and Trade Enforcement Act of 2015 (TFTEA), Customs is now directed to enact updated regulations that require us, your broker, to “verify the identity of the importers who are their clients,” which prompted this proposed rule. That rule has a minimum of twelve data elements that a Customs brokers is required to collect from the client – a few examples here:

  • Customs requires that the broker obtain the POA grantor’s date of birth – “grantor” is the individual executing the POA on behalf of the client
  • A copy of their unexpired government issued photo identification
  • A recent credit report
  • A copy of the client’s business registration and license with State authorities

The proposed rule says that a Customs broker must ‘verify” all information provided by the client to be accurate. It says:

“There are various methods of verification that would satisfy CBP’s requirement that the broker verify each data point that the broker collects. The means of verification that CBP recommends for each data point are set forth below and include in-person verification, review of the proper evidence of the grantor’s authorization to execute the POA, and/or research performed using various federal agency, state government, and publicly available data sources. The broker must use as many of the recommended verification means as necessary to be reasonably certain of the client’s identity.”

We appreciate your support and look forward to hearing from you on this subject. The deadline to submit comments to Customs is October 15, 2019 so please don’t delay. If you have any questions, please contact Samya Murray, Corporate Compliance Officer at sdmurray@cjinternational.com

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