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Understanding CHB (Custom House Broker ) Terminology: (For Reference Only)

Customs Brokerage Fee - Glossary of Terms
The following are descriptions of terms related to Brokerage Services and Fees

4811 Service
This service applies to the completion and submission of U.S. Customs and Border Protection Form
4811. This form is used to advise U.S. Customs and Border Protection when the customer wants
documents forwarded to a party other than the importer of record. Example: Importers that use a 3PL or
4PL provider may want the provider to receive all U.S. Customs and Border Protection post
entry correspondence. In such a case, a U.S. Customs and Border Protection Form 4811 informs the U.S.
Customs and Border Protection to send documents directly to them instead of the Importer of record.

ABI Set-Up
This function includes the entry of a customer’s account information in our system so that it can be
transmitted to U.S. Customs and Border Protection via the Automated Broker Interface (ABI). To ensure
accuracy of importer and consignee information, all IRS numbers are queried via U.S. Customs and
Border Protection’s ABI system. Regardless of bond type, all bond information is linked by IRS number in
preparation for the entry process. This step is critical to ensure that all transmitted data is up to date and
will therefore enable expedited clearance. ABI set-up is included in the base price.

Additional B/L’s on Entry (Bill of Lading)
This service applies to shipments, which can have more than one bill of lading/air waybill per entry
(consolidated entry). Each bill of lading/air waybill represents a shipment and all bills of lading/air waybills
must be included on the entry summary. Therefore, even though the commodity might be the same, input
of each bill of lading/air waybill number must be included for customs purposes.

Additional Line Item
See Lines of Classification.

Additional Invoices
See Commercial Invoices.

Bond Premium
Bond Premium is a fee for the coverage offered by a Single Transaction Bond.

Calculation of Harbor Maintenance Fee (HMF)
This service covers the calculation of the Harbor Maintenance Fee (HMF), which is an ad valorem
(according to value) fee assessed on cargo imports and admissions into foreign trade zones. The fee is
0.125% of the value of the cargo and is paid quarterly, except for imports which are paid at the time of
entry. U.S. Customs and Border Protection deposits the HMF collections into the Harbor Maintenance
Trust Fund. The funds are made available, subject to appropriation, to the Army Corps of Engineers for
the improvement and maintenance of U.S. ports and harbors. Calculation of Harbor Maintenance Fee is
included in the base price.

Calculation of Merchandise Processing Fee (MPF)
This service covers the calculation of the Merchandise Processing Fee (MPF), which is a charge imposed
by U.S. Customs and Border Protection, on an ad valorem (according to value) basis. MPF is 0.21% of
the entered value; Minimum $25, maximum $485. Calculation of the Merchandise Processing Fee is
included in the base price.

Cargo Insurance
This fee provides cargo insurance for the importer’s freight. Cargo insurance, also referred to as ‘Property
Casualty Insurance’, covers the insured against the accidental physical loss or damage from a covered
external danger while in normal course of transit. It is often called ‘Marine Cargo Insurance’ even though
it can cover cargo shipped by all modes of transportation including air and truck. Cargo insurance cannot
give the insured back any lost time if replacement materials need to be manufactured and shipped to the
buyer. Cargo insurance cannot give the insured back any lost future sales if their customer is upset
because the damaged cargo caused a delay in receiving their purchase.

Carnet Entry
This fee applies to shipments imported under a Carnet. A Carnet is a U.S. Customs and Border
Protection document permitting the holder to carry merchandise temporarily into certain foreign countries
(for display, demonstration, or similar purposes) without paying duties or posting bonds.

Clean Truck Administrative Fee
When arranges for pick up of a freight container by truck at the Ports of Los Angeles or Long
Beach, the truck must be claimed in an Electronic System called PortCheck, which is used by the Ports of
Los Angeles and Long Beach to process trucks and to collect the Clean Truck Fee. Fees are charge
claiming each container.

Clean Truck Fee
Effective February 18, 2009, the Ports of Los Angeles and Long Beach will implement the Clean Truck
Fee as part of a plan to attempt to reduce truck pollution. An Electronic System, PortCheck, is used by
the Ports of Los Angeles and Long Beach to process trucks and to collect the Clean Truck Fee. All
containers being picked up by truck directly from the Ports of Los Angeles and Long Beach are processed
through PortCheck. The Clean Truck Fee applies when the truck picking up the freight does not qualify as
a “clean truck” under the Clean Truck Program.

Commercial Invoices (1 per entry included)
The commercial invoice is the document from the seller to the buyer that includes very detailed
information regarding the shipment; price, terms of sale, description, part numbers, delivery address, bill
to party, etc. “1 per entry included” means that included in our base price is the classification of one
invoice.

Continuous Bonds
A Customs Bond is a guarantee to Customs that the importer will pay all duties, taxes, and fees
associated with the importation of commercial goods into the United States, in full and in a timely manner.
This guarantee is typically granted by a surety or bond company to the importer or principal. A continuous
bond can be purchased on an annual basis and will cover all entries for the importer of record, through
any port - providing the broker has a valid power of attorney from the importer or principal. The
continuous bond renews annually until terminated by importer, principal, Customs Broker, or Surety. The
minimum bond amount required by U.S. Customs and Border Protection is $50,000 or 10% of the total
duties, taxes and fees, plus all open increased duty bills and debit vouchers paid in the previous 12-
months; whichever is greater.

Customized Reports Fee
This is a fee for customized reports not available via SCS’ Web-based reporting tools, Flex® Global View.
Reports from our Web-based tools are available free of charge.

Courier (Overnight Documents) - If Used
This charge is applied when a shipment is not SCS carried and arrangements must be made to pick up
or
deliver documents (commercial invoice, HAWB etc.) needed to file the entry.


Customs Consulting Services
We offers a variety of trade consulting services, which are available on an
hourly or per transaction basis. Examples of consulting services include:
o Post Entry Services
o Binding Rulings
o Special trade program eligibility
o Export compliance programs
o Vendor consulting and management
o C-TPAT, CSI, PIP, FAST approval consulting
o Import/export license coordination
o Alternative records storage development

Delivery Order
These are instructions given to the trucking company that will deliver the freight to the ultimate consignee.
This is a manual process.

Disbursement Fee
A disbursement fee is a fee for amounts paid or processed on behalf of a client. The importer has the
option of paying amounts due to U.S. Customs and Border Protection and other government agencies
and freight carriers directly.

Electronic Export Information (EEI)
The Federal Trade Regulation (FTR) mandates that all export information for which a Shipper's Export
Declaration (SED) is required must now be filed electronically through the Automated Export System
(AES) only. Thus, the paper SED form (7525-V) is now obsolete. Census will no longer accept paper
SEDs after September 30, 2008. Electronic Export Information (EEI) is the new official name of data filed
in the AES and is the electronic equivalent to the data previously reported via the paper SED form.

eManifest - Truck
All trucks crossing into the U.S. are required to submit Advance Manifest Information through the ACE
portal of the U.S. Customs and Border Protection (CBP) Truck e-Manifest service.

Entry
An Entry is the documentation required by U.S. Customs and Border Protection, and filed with the
appropriate U.S. Customs and Border Protection officer and/or other government agency, to secure the
release of imported merchandise from U.S. Customs and Border Protection custody, or the act of filing
that documentation - “to make entry”.

Entry/Immediate Release Delivery (Filing of U.S. Customs and Border Protection Form 3461)
This service represents the presentation of U.S. Customs and Border Protection Form 3461 (cargo
release)
to U.S. Customs and Border Protection via ABI. All critical release data is transmitted to U.S. Customs and
Border Protection by using the information formatted within the U.S. Customs and Border Protection Form
3461 for release of the cargo. Once a release message is received from U.S. Customs and Border
Protection, the cargo will be permitted to move on to the destination point. Filing of U.S. Customs and
Border Protection Form 3461 is included in the base price.

Entry Summary (Filing of U.S. Customs and Border Protection Form 7501)
This service represents the presentation of U.S. Customs and Border Protection Form 7501 (entry
summary) to U.S. Customs and Border Protection via ABI. The U.S. Customs and Border Protection Form
7501 is the final presentation to U.S. Customs and Border Protection and includes the payment of duties
and other U.S. Customs and Border Protection related charges. The U.S. Customs and Border Protection
Form 7501 must be filed with U.S. Customs and Border Protection within 10 working days of
entry/immediate release (U.S. Customs and Border Protection Form 3461). Filing of U.S. Customs and
Border Protection Form 7501 is included in the base price.

Emergency Contact Services
This fee is charged for emergency clearance services provided after business hours.

Exam Coordination
This service is incurred when we arrange cartage of freight to the exam site as requested by U.S.
Customs and Border Protection.

FDA Prior Notice Fee
This fee applies to imports that require prior notification by the U.S. Food & Drug Administration (FDA).
Certain Commodities must have prior notification given to the FDA within pre-set timeframes to allow
review of all documents. The goal is to provide FDA with enough information and time to stop potentially
harmful commodities from entering the U.S. SCS can provide the Prior Notice Service upon request.

File Reconstruction
Every entry packet is sent to the Importer of Record (IOR) once billing is completed. This fee is incurred
when additional copies of an entry packet are requested for other parties.

Flex Global View
Flex Global View is the current SCS web-based management reporting tool. Flex Global View is provided
at no additional charge.

Formal Entry
A formal entry is a consumption entry with a shipment value in excess of $2,000. However, certain
commodities such as textiles and plastics may require a formal entry even if the shipment value is less
than $2,000.

FTZ Admission/Withdrawal Entries
This fee is for entry or withdrawal from a Foreign Trade Zone (FTZ). An FTZ is a special commercial or
industrial area in or near a port of entry where foreign and domestic merchandise, including raw
materials, components, and finished goods may be brought in without being subject to payment of
customs duties. Merchandise brought into these zones may be stored, sold, exhibited, repacked,
assembled, sorted, graded, cleaned, or otherwise manipulated prior to re-export or entry in the national
customs territory.

Government Contract Follow Up Fee
This fee applies to shipments imported duty free under a government contract number. The duty-free
status is contingent on a valid certificate. The fee covers entry summary preparation, requesting the
dutyfree certificate(s) from the Defense Logistics Agency and submitting the entry to U.S. Customs and
Border Protection for immediate liquidation.

Hand Carry
This fee applies to shipments that are hand-carried into the U.S. aboard a commercial carrier. Since
these shipments must still clear U.S. Customs and Border Protection, special arrangements must be
made for the customs broker to meet the person at the airport with the release information so they can
proceed through U.S. Customs and Border Protection without delays.

Hub User’s Fee
The Hub User’s fee is a U.S. Customs and Border Protection Fee that applies only to freight shipments
transiting.

Importer Security Filing (ISF) Fee
This fee covers the collection, validation, and submission of information to U.S. Customs and Border
Protection (CBP) for ocean shipments on behalf of an importer. An ISF is required to be submitted
electronically to CBP 24 hours prior to loading ocean freight on any vessel destined for the U.S. This fee
covers ISF services provided for shipments entered for consumption, entered into a foreign trade zone
(FTZ), or for any shipment transiting the U.S. en route to a foreign destination under a transportation
bond.

Importer Security Filing (ISF) Amendment Fee
If there are any amendments that need to be made after the initial ISF filing is processed, an amendment
can be requested. This fee applies to that service.

In-bond Entry
In the event freight must be moved from one port to another, U.S. Customs and Border Protection must
be provided with an entry that gives the details of the move. This process allows the freight to be moved
without being cleared as it has not yet entered the commerce of the U.S. but is still considered “bonded”
freight. Upon arrival in the destination port, the freight can be cleared and duties paid.

Informal Entry
An informal entry is a consumption entry valued less than $2,000, but more than $200. A shipment valued
less than $200 may enter the U.S. as a section 321 (for a definition, see Section 321) entry.

Invoice Revision Fee
This fee is charged in the event the SCS’ invoice needs to be revised and re-billed to another party due to
customer request after the initial billing. All invoicing is based on customer instructions and/or
instructions that are provided on the commercial invoice.

Landed Costs
This fee covers the administrative work to research and document Landed Cost reports. Landed cost is
the total cost of a shipment delivered to a named location, specifically the cost of the goods plus the cost
of transportation.

Lines of Classifications (1 per entry included)
Each product must be classified with a tariff classification number. One invoice can have numerous parts
requiring many classifications. U.S. Customs and Border Protection regulations state that products that
are
“specifically provided for” in the tariff must be utilized before using “parts not specially provided for”
elsewhere in the tariff. Note that each country of manufacture must be listed separately even though the
same classification may apply. “1 per entry included” means that our base price includes one line of
classification.

Messenger Service (Non-SCS Shipments)
When another carrier is used, documents needed to release the shipment must be picked up at the
carrier’s site and returned back to the SCS clearance office for processing. This fee covers the services of
a messenger to physically pick up the documents.

Monitor/Transmit Prior Notice Number
After submitting the prior notice, the submitter will receive an approval number to allow the freight to move
into the U.S. This number is then attached to the actual entry and FDA release request as part of the
immediate release entry documentation.

Normal Postal Fee
This service is included in our base fee and covers the cost of postal services.

Ocean Delivery Coordination
This fee applies for the arrangement of an ocean shipment delivery.

Other Government Agency Transmission
This fee applies when entry documents are transmitted to various government agencies, including:
o U.S. Federal Communications Commission (FCC)
o Food & Drug Administration (FDA)
o U.S. Fish & Wildlife (F&W)
o U.S. Department of Transportation (DOT)
o Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF)
o United States Department of Agriculture (USDA)

Overtime Fee
Weekend clearances, after-hours clearances, and any other special arrangements required to clear a
shipment outside normal working hours may incur this fee.

Personal Effects Entry
This fee covers the importation of personal use items, i.e. if a customer is moving their personal effects to
the U.S. Personal effects imports in this manner cannot be sold or given away for the period of one year
from the date of importation.

Pier Pass
PierPASS is a not-for-profit organization created by marine terminal operators to reduce congestion and
improve air quality in and around the Ports of Los Angeles and Long Beach.

OffPeak is the off-peak hours program created by PierPASS. OffPeak provides an incentive for cargo
owners to move cargo at night and on weekends, in order to reduce truck traffic and pollution during peak
daytime traffic hours and to alleviate port congestion.

Post Entry Amendment (PEA)
This fee covers the research and submission of a PEA, which allows for the correction of classification,
valuation or other errors prior to the liquidation of an entry. In most cases, a PEA is submitted with the
goal of obtaining a duty refund.

Protest
This fee covers the creation and submission of a protest to U.S. Customs and Border Protection on behalf
of an importer. A protest is a means by which an importer, consignee, or other designated party may
challenge a decision made by U.S. Customs and Border Protection. A protest must be filed within 90 days
after liquidation.

Scanning Fee
This service provides for the scanning of documentation upon the customer’s request.

Service to Act as a Registered U.S. Agent
(Food and Drug Administration [FDA] Bio-Terrorism Act Requirement)
If an importer does not have agent representation in the U.S., SCS will provide this service for a fee. This
service is limited to Food & Drug Administration business as it pertains to rules and regulations set forth
by the FDA and the Bio-Terrorism Act.

Single Transaction Bond Preparation
A bond is required by the federal government in connection with the payment of duties or to produce
documentation. U.S. Customs and Border Protection entries must be accompanied by evidence that a
surety
bond is posted with U.S. Customs and Border Protection to cover any potential duties, taxes, and
penalties
which may accrue. A single entry bond is prepared by the broker and covers one shipment. This fee covers
the preparation of the required bond.

Section 321
This fee provides simplified entry processing for shipments valued at $200 USD or less. There is no duty
or Merchandise Processing Fee (MPF) assessed by U.S. Customs and Border Protection on most
Section 321 entries; however, certain products such as textiles, clothing, alcohol, tobacco, and food may
require a formal entry, regardless of value.

Steel License Program
All steel entering the U.S. must be licensed until 2009 as a result of an Executive Order requiring the
monitoring of U.S. steel imports. This fee covers the required reporting to the U.S. Government. Once the
Executive Order expires, additional duty increases may apply. A license must be obtained for each entry
containing steel and is required at the time of processing U.S. Customs and Border Protection Form
7501.

Temporary Importation Bond (TIB) Entry
When merchandise is imported for temporary use into the U.S., a Temporary Importation Bond (TIB) entry
may be used to allow the cargo entry into the U.S. without the payment of duties. Under a TIB, the
merchandise can stay in the U.S. for one year, with the potential to obtain two, one-year extensions for a
total period of three years. The TIB must be cancelled prior to exportation or there may be penalties
issued by Customs & Border Protection.

TIB Cancellation
Upon export, a TIB must be cancelled by providing U.S. Customs and Border Protection with the original
entry information from which it entered into the U.S. Upon approval by U.S. Customs and Border
Protection, the TIB will be cancelled and duties will not be owed to U.S. Customs and Border Protection.
If the TIB is not cancelled properly, U.S. Customs and Border Protection can impose a penalty.

Textile Entry
These are entries that primarily include textiles.

Textile Surcharge – Occasional Customer
This fee applies to irregular importers of textiles to cover the complexity and additional time to correctly
classify textile entries.

Ultimate Consignee Surcharge:
U.S. Customs and Border Protection requires the proper identification of the Ultimate Consignee when
making an entry into the U.S. Without this information, entry into the U.S. will be denied. Additionally,
U.S. Customs and Border Protection requires the identification number to be reported on each line item of
the customs entry. This surcharge covers the broker collecting the required information and/or submitting
it to CBP.

The Ultimate Consignee is the party in the U.S. to whom the foreign shipper sold the imported goods. If
the merchandise has not been sold, the Ultimate Consignee is defined as the party in the U.S. to whom
the foreign shipper consigned the imported goods. If the imported goods have not been sold or consigned
to a U.S. party, then the Ultimate Consignee is defined as the proprietor of the U.S. premises to which the
goods are to be delivered. Ultimate Consignee can be identified by the Federal Employer Identification
Number, Social Security Number, or U.S. Customs and Border Protection Port Assigned Number for Non-
Resident Importers.

Use of Importers Bond with Valid Power of Attorney (POA)
This service is part of our base entry fee. The POA gives the customs broker the authority to submit
documents and conduct other customs business on behalf of the importer. One of the requirements of a
POA is that a bond must be in place. If the customer already has a Continuous bond, the only way a
broker can use the importer’s bond is by the importer granting the bond user a POA. Use of Importers
Bond with a valid POA is included in the base price.

Warehouse Entry
If the merchandise does not have to be used immediately after it is imported, a warehouse entry can be
made. The merchandise is held in a bonded warehouse without the payment of duties.

Warehouse Withdrawal for Consumption
A warehouse withdrawal is the removal of freight from storage. At that time, a warehouse withdrawal is
prepared to remove the freight by clearing it through Customs, paying duties, and making the cargo
available to the buyer/ultimate consignee.

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