[Federal Register Volume 83, Number 113 (Tuesday, June 12, 2018)]
[Rules and Regulations]
[Pages 27380-27407]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-12315]



[[Page 27379]]

Vol. 83

Tuesday,

No. 113

June 12, 2018

Part II





 Department of Homeland Security





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 U.S. Customs and Border Protection





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19 CFR Parts 12, 113 et al.





 Air Cargo Advance Screening (ACAS); Final Rule

Federal Register / Vol. 83 , No. 113 / Tuesday, June 12, 2018 / Rules 
and Regulations

[[Page 27380]]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection

19 CFR Parts 12, 113, 122, 141, 178, and 192

[Docket No. USCBP-2018-0019; CBP Dec. 18-05]
RIN 1651-AB04


Air Cargo Advance Screening (ACAS)

AGENCY: U.S. Customs and Border Protection, DHS.

ACTION: Interim final rule; request for comments.

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SUMMARY: To address ongoing aviation security threats, U.S. Customs and 
Border Protection (CBP) is amending its regulations pertaining to the 
submission of advance air cargo data to implement a mandatory Air Cargo 
Advance Screening (ACAS) program for any inbound aircraft required to 
make entry under the CBP regulations that will have commercial cargo 
aboard. The ACAS program requires the inbound carrier or other eligible 
party to electronically transmit specified advance cargo data (ACAS 
data) to CBP for air cargo transported onboard U.S.-bound aircraft as 
early as practicable, but no later than prior to loading of the cargo 
onto the aircraft. The ACAS program enhances the security of the 
aircraft and passengers on U.S.-bound flights by enabling CBP to 
perform targeted risk assessments on the air cargo prior to the 
aircraft's departure for the United States. These risk assessments will 
identify and prevent high-risk air cargo from being loaded on the 
aircraft that could pose a risk to the aircraft during flight.

DATES: 
    Effective date: This interim final rule is effective June 12, 2018.
    Comment date: Comments must be received by August 13, 2018.

ADDRESSES: Please submit any comments, identified by docket number 
[USCBP-2018-0019], by one of the following methods:
    <bullet> Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    <bullet> Mail: Border Security Regulations Branch, Office of Trade, 
U.S. Customs and Border Protection, 90 K Street NE, 10th Floor, 
Washington, DC 20229-1177.
    Instructions: All submissions received must include the agency name 
and docket number for this rulemaking. All comments received will be 
posted without change to http://www.regulations.gov, including any 
personal information provided.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov. Submitted comments 
may also be inspected during regular business days between the hours of 
9:00 a.m. and 4:30 p.m. at the Office of Trade, U.S. Customs and Border 
Protection, 90 K Street NE, 10th Floor, Washington, DC. Arrangements to 
inspect submitted comments should be made in advance by calling Mr. 
Joseph Clark at (202) 325-0118.

FOR FURTHER INFORMATION CONTACT: Craig Clark, Cargo and Conveyance 
Security, Office of Field Operations, U.S. Customs and Border 
Protection, by telephone at 202-344-3052 and email at 
<a href="/cdn-cgi/l/email-protection#751607141c125b161914071e351617055b111d065b121a03"><span class="__cf_email__" data-cfemail="d8bbaab9b1bff6bbb4b9aab398bbbaa8f6bcb0abf6bfb7ae">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Public Participation
II. Executive Summary
III. Background and Purpose
    A. Current Regulatory Requirements
    1. CBP Regulatory Requirements
    2. TSA Requirements
    B. Air Cargo Security Risks
    C. ACAS Pilot
IV. Mandatory ACAS Program
    A. New 19 CFR 122.48b, Air Cargo Advance Screening (ACAS)
    B. Eligible ACAS Filers
    C. Time Frame for Filing ACAS Data
    D. ACAS Data
    1. ACAS Data Definitions
    2. Mandatory ACAS Data
    3. Conditional ACAS Data: Master Air Waybill Number
    4. Optional ACAS Data
    E. Filing and Updating the ACAS Data
    F. ACAS Referrals
    G. Do-Not-Load (DNL) Instructions
    H. Responsibilities of ACAS Filers
    1. Responsibility To Provide Accurate and Timely Data
    2. Responsibility To Resolve ACAS Referrals
    3. Responsibility To Address Do-Not-Load (DNL) Instructions
    I. Amendments to Bond Conditions
    J. Amendments to 19 CFR 122.48a
    1. Flight Departure Message (FDM)
    2. Other Amendments to 19 CFR 122.48a
    K. Flexible Enforcement
V. Statutory and Regulatory Reviews
    A. Adminstrative Procedure Act
    B. Executive Orders 12866, 13563, and 13771
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Privacy
    F. Paperwork Reduction Act
VI. Signing Authority
    List of Subjects
    Regulatory Amendments

I. Public Participation

    Interested persons are invited to participate in this rulemaking by 
submitting written data, views, or arguments on all aspects of this 
interim final rule. The Department of Homeland Security (DHS) and CBP 
also invite comments that relate to the economic, environmental, or 
federalism effects that might result from this interim final rule. 
Comments that will provide the most assistance to CBP will reference a 
specific portion of the interim final rule, explain the reason for any 
recommended change, and include data, information, or authority that 
support such recommended change.

II. Executive Summary

    Terrorist attacks on international aviation, particularly while the 
aircraft is in flight, are a very real threat. In the past few years, 
terrorists have made several significant attempts to attack commercial 
aircraft. These attempts include the Christmas Day 2009 attempt to 
bring down a U.S.-bound passenger plane via the use of plastic 
explosives hidden in a terrorist's underwear, the explosion aboard 
Russian Metrojet Flight 9268 above Egypt's Sinai Peninsula in October 
2015, and the attempted onboard suicide attack on a commercial aircraft 
in February 2016 after takeoff in Mogadishu, Somalia. These incidents 
underscore the persistent threat to commercial aviation and emphasize 
the importance of aviation security.
    The Department of Homeland Security (DHS) was established, in part, 
to prevent such attacks, and to ensure aviation safety and security. It 
is essential that DHS constantly adapt its policies and regulations and 
use shared intelligence to address these terrorist threats since 
terrorists continue to seek out and develop innovative ways to thwart 
security measures. Global terrorist organizations such as Al Qaeda and 
the Islamic State of Iraq and the Levant (ISIL), as well as their 
offshoots and associates, remain committed to targeting international 
commercial airline operations in order to maximize the effects of their 
terror campaigns. They aim to exploit any security vulnerability.
    In October 2010, a new aviation security vulnerability was exposed. 
Terrorists placed concealed explosive devices in cargo onboard two 
aircraft destined to the United States. The explosive devices were 
expected to explode mid-air over the continental United States, which 
could have caused catastrophic damage to the aircraft, the passengers, 
crew, and persons and property on the ground. In materials published by 
a terrorist organization shortly after the October 2010 incident, it 
was noted that due to the increased

[[Page 27381]]

passenger screening implemented after the Christmas Day 2009 attempt, 
the terrorist organization decided to employ explosive devices sent via 
air cargo. While the 2010 potential terrorist attack was thwarted by 
multiple foreign governments working together to share intelligence and 
intercept the shipments before they detonated, the explosive devices 
were flown aboard several flights before they were discovered. 
Recently, Australian authorities thwarted a plot to place an Improvised 
Explosive Device (IED) on an Etihad Airways flight, using components 
that had been shipped to Australia by an Islamic State in Syria (ISIS) 
commander via air cargo. Additionally, DHS has received specific, 
classified intelligence that certain terrorist organizations seek to 
exploit vulnerabilities in international air cargo security to cause 
damage to infrastructure, injury, or loss of life in the United States 
or onboard aircraft. DHS must ensure that terrorists cannot exploit 
vulnerabilities in air cargo supply chain security to introduce 
dangerous cargo that could cause catastrophic effect to the aircraft.
    In order to deter and disrupt terrorist threats to U.S.-bound 
aircraft via air cargo, DHS must ensure that high-risk cargo is 
identified prior to the aircraft's departure for the United States. 
Within DHS, two components, U.S. Customs and Border Protection (CBP) 
and the Transportation Security Administration (TSA), have 
responsibilities for securing inbound air cargo bound for the United 
States. CBP and TSA employ a layered security approach to secure 
inbound air cargo, including using various risk assessment methods to 
identify high-risk cargo and to mitigate any risks posed.
    For the reasons discussed below, DHS believes that the current 
regulatory requirements should be enhanced to address the ongoing 
threats to in-flight aviation security, particularly concerning air 
cargo. DHS is making regulatory changes to ensure that DHS has the 
necessary tools to address these threats and ensure the safety of U.S.-
bound flights.
    TSA regulations require carriers to apply security measures, 
including screening, to all cargo inbound to the United States from the 
last point of departure. See 49 CFR parts 1544 and 1546. Through TSA's 
regulatory framework, TSA issues security programs for carriers to 
adopt at last points of departure for cargo inbound to the United 
States. These security programs require aircraft operators and foreign 
air carriers to determine the appropriate level of screening (baseline 
versus enhanced) to apply to each cargo shipment in accordance with 
risk-based criteria contained within their TSA security program. TSA 
regulations require the carrier to perform enhanced air cargo screening 
on cargo deemed high-risk prior to the cargo departing for the United 
States.\1\ TSA has authority to impose penalties for violations of 
these regulations pursuant to 49 U.S.C. 144(d) and 49 CFR part 1503.
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    \1\ The screening methods are contained within the carrier's 
respective security program. The specific security measures are 
Sensitive Security Information, the public disclosure of which is 
prohibited by law to the extent that such disclosure would be 
detrimental to transportation security. See 49 U.S.C. 114(r), 49 CFR 
part 1520.
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    CBP performs an additional risk assessment to identify inbound 
cargo that may pose a security risk using advance air cargo data and 
intelligence related to specific air cargo. Under current CBP 
regulations, an inbound air carrier or other eligible party must 
transmit specified advance air cargo data to CBP for any inbound 
aircraft required to make entry under 19 CFR 122.41 that will have 
commercial cargo aboard.\2\ See 19 CFR 122.48a. In most cases, advance 
data pertaining to air cargo must be transmitted to CBP four hours 
prior to arrival of the aircraft in the United States. For specified 
short flights, the advance data must be transmitted to CBP no later 
than the time of departure of the aircraft.\3\ Upon receipt of the 
advance air cargo data, CBP analyzes the data using its Automated 
Targeting System (ATS) and other relevant intelligence at each U.S. 
port of entry to identify potential threats. Upon the arrival of the 
cargo at the U.S. port of entry, CBP inspects all air cargo identified 
as high-risk to ensure that dangerous cargo does not enter the United 
States.
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    \2\ 19 CFR 122.41 requires that all aircraft coming into the 
United States from a foreign area must make entry, subject to 
specified exceptions.
    \3\ See 19 CFR 122.48a(b) which provides that CBP must 
electronically receive the required advance air cargo data no later 
than the time of departure of the aircraft for the United States 
from any foreign port or place in North America, including locations 
in Mexico, Central America, South America (from north of the Equator 
only), the Caribbean, and Bermuda; or no later than four hours prior 
to the arrival of the aircraft in the United States for aircraft 
departing for the United States from any other foreign area.
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    Under the current CBP regulatory time frames for transmitting air 
cargo data, CBP may not be able to identify high-risk cargo such as 
unauthorized weapons, explosives, chemical and/or biological weapons, 
WMDs, or other destructive substances or items in the cargo until it is 
already en route to the United States. This is because the 19 CFR 
122.48a time frames do not provide CBP adequate time to perform 
targeted risk assessments on the air cargo before the aircraft departs 
for the United States. Terrorists have already exploited this security 
vulnerability by placing explosive devices aboard aircraft destined to 
the United States. Explosives and/or weapons contained in air cargo 
could potentially be detonated during flight. Such a terrorist attack 
could result in destruction of the aircraft, serious injuries or death 
to passengers and crew, and potential ground-level victims or targets.
    To address this situation, CBP and TSA determined that, in order to 
best identify high-risk air cargo, it is essential to perform a risk 
assessment earlier in the air cargo supply chain, prior to the 
aircraft's departure. This risk assessment must be based on real-time 
data and intelligence available to determine if the cargo posed a risk 
to the aircraft in flight. CBP and TSA concluded that such a risk 
assessment should be performed at a centralized location and with input 
from both CBP and TSA, rather than at individual U.S. ports of entry. 
As a result, CBP and TSA formed a joint CBP-TSA targeting operation in 
a centralized location to allow collaboration between the DHS 
components. The joint CBP-TSA targeting operation utilizes CBP's ATS 
and other available intelligence as a risk targeting tool to leverage 
data and information already collected in order to secure international 
inbound air cargo. This allows CBP and TSA to address specific threat 
information in real time.
    In addition, CBP, in collaboration with TSA and the air cargo 
industry, began operating a voluntary Air Cargo Advance Screening 
(ACAS) pilot in December 2010 to collect certain advance air cargo data 
earlier in the supply chain. Pilot participants voluntarily provide CBP 
with a subset of the 19 CFR 122.48a data, (referred to hereafter as the 
``ACAS pilot data'') as early as practicable prior to loading the cargo 
onto the aircraft. This allows sufficient time for targeting before the 
departure of the aircraft. Based on the ACAS pilot data, when CBP 
determines that cargo is high-risk, that cargo will require screening 
pursuant to TSA-approved screening methods for high-risk cargo.\4\
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    \4\ The ACAS pilot utilizes TSA authority to require enhanced 
screening for air cargo identified as high-risk pursuant to TSA-
approved screening methods.
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    The ACAS pilot has been successful in enabling CBP to identify a 
substantial amount of high-risk cargo. Significantly, CBP has 
identified a substantial number of air cargo shipments that have 
potential ties to terrorism and, therefore, may represent a threat. 
When this high-

[[Page 27382]]

risk cargo is identified, enhanced cargo screening is performed 
pursuant to TSA-approved or accepted security programs.
    During the ACAS pilot, air cargo that may have only received 
baseline screening per the carriers' TSA-approved or accepted security 
programs could be identified as high-risk through ACAS, triggering 
enhanced screening under the air carrier's security program-
requirements. Through joint agency management and information sharing, 
the ACAS pilot uses tactical and real-time data to enhance the security 
of the air cargo supply chain. However, because the pilot is voluntary, 
it does not completely address the existing security vulnerability.
    To address the continuing security threats, DHS is amending the CBP 
regulations to add a new section, 19 CFR 122.48b, to implement a 
mandatory ACAS program. CBP's objective for the ACAS program is to 
obtain the most accurate data at the earliest time possible with as 
little impact to the flow of commerce as possible. The new ACAS 
requirements apply to any inbound aircraft required to make entry under 
19 CFR 122.41 that will have commercial cargo aboard. These are the 
same aircraft that are subject to the current 19 CFR 122.48a 
requirements. Under the amendments, an inbound air carrier and/or other 
eligible ACAS filer \5\ must transmit specified air cargo data 
(hereafter referred to as ``ACAS data'') to CBP earlier in the supply 
chain so that CBP, can perform the necessary risk assessments prior to 
the aircraft's departure for the United States. The ACAS data must be 
transmitted as early as practicable, but no later than prior to loading 
of the cargo onto the aircraft.
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    \5\ See Section IV.B. for more information about the parties 
that may voluntarily provide the ACAS data and the eligibility 
requirements for these parties.
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    Under the new time frame, CBP will have sufficient time before the 
aircraft departs to analyze the data, identify if the cargo has a nexus 
to terrorism, and, with TSA, take the necessary action to thwart a 
potential terrorist attack or other threat. Just like the ACAS pilot, 
the ACAS program will allow CBP to issue referrals and/or Do-Not-Load 
(DNL) instructions. Specifically, under the ACAS program, CBP will 
issue ACAS referrals when clarifying information and/or enhanced 
screening of high-risk cargo is needed to mitigate any risk. Referrals 
for screening will be issued pursuant to CBP authorities and resolved 
using TSA-approved or accepted security programs. The ACAS program will 
enable CBP to issue DNL instructions when a combination of ACAS data 
and intelligence points to a threat or terrorist plot in progress. As 
with the pilot, this rule and corresponding TSA-approved or accepted 
security program requirements will enhance the ability to prevent air 
cargo that may contain a potential bomb, improvised explosive device, 
or other material that may pose an immediate, lethal threat to the 
aircraft and/or its vicinity from being loaded aboard the aircraft and 
will allow law enforcement authorities to coordinate with necessary 
parties. Under the new regulations, CBP will be able to take 
appropriate enforcement action against ACAS filers who do not comply 
with the ACAS requirements. Upon issuance of changes to security 
program requirements under 49 CFR parts 1544 and 1546, TSA will enforce 
implementation of enhanced screening methods in response to an ACAS 
referral.
    The new 19 CFR 122.48b specifies the general ACAS requirements, the 
eligible filers, the ACAS data, the time frame for providing the data 
to CBP, and the responsibilities of the filers, and explains the 
process regarding ACAS referrals and DNL instructions. The ACAS data is 
a subset of the data currently collected under 19 CFR 122.48a and is 
generally the same data that is currently collected in the ACAS pilot. 
However, the new regulation adds a new conditional data element, the 
master air waybill number, which is not required in the ACAS pilot. 
This data element will provide the location of the high-risk cargo and 
will allow CBP to associate the cargo with an ACAS submission.
    CBP is also amending 19 CFR 122.48a to reference the ACAS 
requirements and to incorporate a few additional changes. Specifically, 
CBP is amending 19 CFR 122.48a to revise the definition of one of the 
data elements (consignee name and address) to provide a more accurate 
and complete definition, and to add a new data element requirement, the 
flight departure message (FDM), to enable CBP to determine the 
timeliness of ACAS submissions. CBP is also amending the applicable 
bond provisions in 19 CFR part 113 to incorporate the ACAS 
requirements.
    In order to provide the trade sufficient time to adjust to the new 
requirements and in consideration of the business process changes that 
may be necessary to achieve full compliance, CBP will show restraint in 
enforcing the data submission requirements of this rule for twelve 
months after the effective date. While full enforcement will be phased 
in over this twelve month period, willful and egregious violators will 
be subject to enforcement actions at all times. In accordance with TSA 
regulations, inbound air carriers will be required to comply with their 
respective TSA-approved or accepted security program, including the 
changes being implemented for purposes of the ACAS program.
    The chart below includes a summary of the current 19 CFR 122.48a 
advance air cargo data requirements, the requirements under the ACAS 
pilot, and the regulatory changes that are being promulgated by this 
rulemaking.

                                   Summary of ACAS Changes to CBP Requirements
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                                                                                         ACAS IFR (new 19 CFR
                                                                                        122.48b requirements in
                               Current requirements (19           ACAS pilot            addition to the current
                                     CFR 122.48a)                                       requirements in 19 CFR
                                                                                               122.48a)
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Timing of Data Submission..  Time of departure or 4       At the earliest point       As early as practicable,
                              hours prior to arrival       practicable prior to        but no later than prior
                              depending on port of         loading of the cargo onto   to loading of the cargo
                              departure.                   the aircraft.               onto the aircraft.
                                                          No changes to the timing    No changes to the timing
                                                           of 19 CFR 122.48a           of 19 CFR 122.48a
                                                           requirements.               requirements.

[[Page 27383]]

 
Data.......................  17 data elements \6\.......  6 data elements (subset of  6 mandatory data elements
                             Mandatory:.................   19 CFR 122.48a data         (subset of 19 CFR 122.48a
                             <bullet> Air waybill          elements) transmitted at    data elements and same as
                              number(s)--master and        the lowest air waybill      ACAS pilot) at the lowest
                              house, as applicable..       level \7\.                  air waybill level, plus
                             <bullet> Shipper name and    Mandatory:................   one conditional and one
                              address..                   <bullet> Air waybill         optional data element.
                             <bullet> Consignee name and   number..                   Mandatory:
                              address..                   <bullet> Shipper name and   <bullet> Air waybill
                             <bullet> Cargo description.   address..                   number.
                             <bullet> Total quantity      <bullet> Consignee name     <bullet> Shipper name and
                              based on the smallest        and address..               address.
                              external packing unit..     <bullet> Cargo              <bullet> Consignee name
                             <bullet> Total weight of      description..               and address.
                              cargo..                     <bullet> Total quantity     <bullet> Cargo
                             <bullet> Trip/flight          based on the smallest       description.
                              number..                     external packing unit..    <bullet> Total quantity
                             <bullet> Carrier/ICAO code.  <bullet> Total weight of     based on the smallest
                             <bullet> Airport of           cargo..                     external packing unit.
                              arrival..                                               <bullet> Total weight of
                             <bullet> Airport of origin.                               cargo.
                             <bullet> Scheduled date of
                              arrival..
                             Conditional:                                             Conditional:
                             <bullet> Consolidation                                   <bullet> Master air
                              identifier..                                             waybill number.
                             <bullet> Split shipment                                  Optional:
                              indicator..                                             <bullet> Second notify
                             <bullet> Permit to proceed                                party.
                              information..                                           Addition of the Flight
                             <bullet> Identifier of                                    Departure Message (FDM)
                              other party which is to                                  to the current 19 CFR
                              submit additional air                                    122.48a data elements.
                              waybill information..
                             <bullet> In-bond
                              information..
                             <bullet> Local transfer
                              facility..
Eligible Filers............  Inbound air carriers, other  Inbound air carriers,       Inbound air carriers,
                              filers eligible under 19     other filers eligible       other filers eligible
                              CFR 122.48a \8\.             under 19 CFR 122.48a, and   under 19 CFR 122.48a, and
                                                           freight forwarders.         freight forwarders.
Bond requirements..........  All 19 CFR 122.48a filers    Parties are not required    All ACAS filers are
                              are required to have an      to have a bond to           required to have an
                              appropriate bond.            participate in pilot.       appropriate bond.
                                                                                       Eligible filers include
                                                                                       inbound air carriers,
                                                                                       other eligible 19 CFR
                                                                                       122.48a filers,\9\ and
                                                                                       freight forwarders.
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                                   Summary of ACAS Impact on TSA Requirements
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                               Current requirements (49
                               CFR parts 1544 and 1546)         ACAS pilot         ACAS IFR (new 19 CFR 122.48b)
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TSA Screening................  Per TSA regulations,      Per TSA regulations,      Per TSA regulations, inbound
                                inbound air carriers      inbound air carriers      air carriers are required to
                                are required to comply    are required to comply    comply with the screening
                                with the baseline and     with the baseline and     methods contained within
                                enhanced air cargo        enhanced screening        their respective TSA-
                                screening protocols       methods contained         approved or accepted
                                contained within their    within their respective   security programs. These
                                respective TSA security   TSA security programs;    security programs already
                                programs \10\.            under the ACAS pilot,     include requirements to
                                                          enhanced screening        implement enhanced screening
                                                          methods as outlined in    procedures for certain
                                                          the carrier's security    cargo, including cargo
                                                          program apply to all      designated as elevated risk
                                                          ACAS referrals for        cargo because it meets any
                                                          screening.                of the criteria set forth in
                                                                                    the security programs. TSA
                                                                                    will implement corresponding
                                                                                    changes in these programs
                                                                                    requiring implementation of
                                                                                    enhanced screening methods
                                                                                    for ACAS referrals.
----------------------------------------------------------------------------------------------------------------

III. Background and Purpose

    The Homeland Security Act of 2002 established DHS to prevent 
terrorist attacks within the United States and to reduce the 
vulnerability of the United States to terrorism. See Public Law 107-
296, 116 Stat. 2142. Terrorist threats to the aviation transportation 
system continue to represent a meaningful risk given the expressed 
intentions of terrorists, their persistent attempts to thwart security 
and target aviation, and the perceived fiscal and human consequences of 
a successful attack. In response to these aviation threats, DHS has 
created a comprehensive, coordinated policy for securing air cargo 
entering, transiting within, and departing the United States.
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    \6\ 19 CFR 122.48a specifies, based on the type of shipment, 
what data the inbound air carrier must transmit to CBP and what data 
other eligible filers may transmit to CBP. For non-consolidated 
shipments, the inbound air carrier must transmit to CBP the 17 data 
elements (11 mandatory, 6 conditional) applicable for the air 
waybill record. For consolidated shipments, the inbound air carrier 
must transmit to CBP the 17 data elements (11 mandatory, 6 
conditional) that are applicable to the master air waybill, and the 
inbound air carrier must transmit a subset of the data (7 mandatory, 
1 conditional) for all associated house air waybills, unless another 
eligible filer transmits this data to CBP. For split shipments, the 
inbound air carrier must submit an additional subset of this data (9 
mandatory, 3 conditional) for each house air waybill.
    \7\ The six ACAS data elements have been referred to by the 
trade as ``7+1'' data by considering ``shipper name and address'' 
and ``consignee name and address'' to be four data elements instead 
of two. As this data is included in 19 CFR 122.48a as two data 
elements, CBP will continue to refer to ``six ACAS data elements'' 
and not ``7+1.''
    \8\ Other filers eligible under 19 CFR 122.48a include Automated 
Broker Interface (ABI) filers (importers and brokers), Container 
Freight Stations/deconsolidators, Express Consignment Carrier 
Facilities, and air carriers that arranged to have the inbound air 
carrier transport the cargo to the United States.
    \9\ The inbound air carrier and other eligible 19 CFR 122.48a 
filers will already have a CBP bond to file the 19 CFR 122.48a data 
and that bond will be expanded under the ACAS program through no 
action on their part. This is because CBP is amending the various 
CBP bonds to incorporate the ACAS requirements as a condition of the 
bonds.
    \10\ Note that TSA screening occurs prior to the aircraft's 
departure for the United States. Under 19 CFR 122.48a, CBP usually 
identifies high-risk cargo on the basis of the submitted data when 
the aircraft is in flight and CBP performs inspections of air cargo 
identified as high-risk upon its arrival at a U.S. port of entry.
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    Within DHS, two components, CBP and TSA, have responsibilities for 
securing inbound air cargo bound for the United States. Under the 
current regulatory framework, TSA has responsibility for ensuring the 
security of the nation's transportation of cargo by air into the United 
States while CBP has responsibility for securing the nation's borders 
by preventing high-risk cargo

[[Page 27384]]

from entering the United States. CBP and TSA's current regulatory 
requirements are described below.

A. Current Regulatory Requirements

1. CBP Regulatory Requirements
    Section 343(a) of the Trade Act of 2002, Public Law 107-210, 116 
Stat. 981 (August 6, 2002), as amended (Trade Act) (19 U.S.C. 2071 
note), authorizes CBP to promulgate regulations providing for the 
mandatory transmission of cargo information by way of a CBP-approved 
electronic data interchange (EDI) system before the cargo is brought 
into or departs the United States by any mode of commercial 
transportation. The required cargo information is that which is 
reasonably necessary to enable high-risk cargo to be identified for 
purposes of ensuring cargo safety and security pursuant to the laws 
enforced and administered by CBP.
    On December 5, 2003, CBP published a final rule in the Federal 
Register (68 FR 68140) to effectuate the provisions of the Trade Act. 
Among other amendments, a new Sec.  122.48a (19 CFR 122.48a) was added 
to title 19 of the CFR to implement advance reporting requirements for 
cargo brought into the United States by air. As provided in 19 CFR 
122.48a, for any inbound air carrier required to make entry under 19 
CFR 122.41 that will have commercial cargo aboard,\11\ CBP must 
electronically receive certain data regarding that cargo through a CBP-
approved EDI system no later than the time of departure of the aircraft 
for the United States (from specified locations) or four hours prior to 
arrival in the United States for all other locations.
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    \11\ Under 19 CFR 122.41, subject to specified exceptions, all 
aircraft coming into the United States from a foreign area must make 
entry.
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    Under 19 CFR 122.48a, the following advance air cargo data is 
required to be transmitted to CBP no later than the specified time 
frames:

(1) Air waybill number(s) (master and house, as applicable)
(2) Trip/flight number
(3) Carrier/ICAO (International Civil Aviation Organization) code
(4) Airport of arrival
(5) Airport of origin
(6) Scheduled date of arrival
(7) Total quantity based on the smallest external packing unit
(8) Total weight
(9) Precise cargo description
(10) Shipper name and address
(11) Consignee name and address
(12) Consolidation identifier (conditional)
(13) Split shipment indicator (conditional)
(14) Permit to proceed information (conditional)
(15) Identifier of other party which is to submit additional air 
waybill information (conditional)
(16) In-bond information (conditional)
(17) Local transfer facility (conditional)

    Paragraph (d) of 19 CFR 122.48a specifies, based on the type of 
shipment, what data the inbound carrier must transmit to CBP and what 
data other eligible filers may elect to transmit to CBP. There are 
different requirements for consolidated and non-consolidated shipments. 
A consolidated shipment consists of a number of separate shipments that 
have been received and consolidated into one shipment by a party such 
as a freight forwarder for delivery as a single shipment to the inbound 
carrier. Each of the shipments in the consolidated shipment has its own 
air waybill, referred to as the house air waybill (HAWB). The HAWB 
provides the information specific to the individual shipment that CBP 
needs for targeting purposes. The HAWB does not include the flight and 
routing information for the consolidated shipment. Generally speaking, 
a master air waybill (MAWB) is an air waybill that is generated by the 
inbound carrier for a consolidated shipment. For consolidated 
shipments, the inbound carrier must transmit to CBP the above cargo 
data that is applicable to the MAWB, and the inbound carrier must 
transmit a subset of the above data for all associated HAWBs, unless 
another eligible filer transmits this data to CBP. For non-consolidated 
shipments, the inbound carrier must transmit to CBP the above cargo 
data for the air waybill record. For split shipments, i.e., shipments 
that have been divided into two or more smaller shipments, either sent 
together or separately, the inbound carrier must transmit an additional 
subset of this data for each HAWB.
    The method and time frames for presenting the data are specified in 
19 CFR 122.48a(a) and (b). These provisions specify that CBP must 
electronically receive the above data through a CBP-approved EDI system 
no later than the time of the departure of the aircraft for the United 
States from any foreign port or place in North America, including 
locations in Mexico, Central America, South America (from north of the 
Equator only), the Caribbean, and Bermuda; or no later than four hours 
prior to the arrival of the aircraft in the United States for aircraft 
departing for the United States from any other foreign area.
    CBP uses a risk assessment strategy to target cargo that may pose a 
security risk. Upon receipt of the advance air cargo data in the 
specified time frames, CBP analyzes the data at the U.S. port of entry 
where the cargo is scheduled to arrive utilizing ATS to identify 
potential threats. Upon the arrival of the cargo at the U.S. port of 
entry, CBP inspects all air cargo identified as high-risk to ensure 
that dangerous cargo does not enter the United States.
2. TSA Requirements
    With respect to air cargo security, TSA is charged, among other 
things, with ensuring and regulating the security of inbound air cargo, 
including the screening of 100% of international air cargo inbound to 
the United States on passenger aircraft. This screening mandate, 
established by the Implementing Recommendations of the 9/11 Commission 
Act (9/11 Act) of August 2007, requires that TSA ensure all cargo 
transported onboard passenger aircraft operating to, from, or within 
the United States is physically screened at a level commensurate with 
the screening of passenger checked baggage. To achieve this, TSA is 
authorized to issue security requirements for U.S. and foreign air 
carriers at non-U.S. locations for flights inbound to the United 
States.\12\
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    \12\ TSA regulations are found in 49 CFR chapter XII (parts 1500 
through 1699). Parts 1544 and 1546 are specific to U.S. aircraft 
operators (i.e., domestic or U.S. flagged air carriers) and foreign 
air carriers. Sections 1544.205(f) and 1546.205(f) provide that U.S. 
aircraft operators and foreign air carriers, respectively, must 
ensure that cargo loaded onboard an aircraft outside the U.S., 
destined to the U.S., is screened in accordance with the 
requirements in their security program. Sections 1544.101 and 
1546.101 require that certain U.S. aircraft operators, and certain 
foreign air carriers landing or taking off in the U.S., must adopt 
and implement a security program in the form and with the content 
approved or accepted by TSA pursuant to the provisions in Sec. Sec.  
1544.103 and 1546.103. In addition, when TSA determines pursuant to 
Sec.  1544.305 that additional security measures are necessary, it 
will issue Security Directives to U.S. aircraft operators. TSA may 
also issue Emergency Amendments to the security programs of U.S. 
aircraft operators and foreign air carriers as provided in 
Sec. Sec.  1544.105(d) and 1546.105(d).
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    TSA's regulatory framework consists of security programs that TSA 
issues and the air carriers adopt to carry out certain security 
measures, including screening requirements for cargo inbound to the 
United States from non-U.S. locations. Details related to the security 
programs are considered Sensitive Security Information (SSI),\13\

[[Page 27385]]

and are made available to carriers as necessary. Within this framework, 
TSA has the flexibility to modify its air cargo screening requirements 
as needed based on changing security environments, intelligence, and 
emergency situations through Emergency Amendments/Security Directives 
(EAs/SDs). Carriers may also request amendments to their respective 
security programs in response to changing market and industry 
conditions.\14\ Additionally, carriers may request TSA approval to 
follow recognized National Cargo Security Program (NCSP) Recognition 
procedures in lieu of their TSA security programs.
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    \13\ ``Sensitive Security Information'' or ``SSI'' is 
information obtained or developed in the conduct of security 
activities, the disclosure of which would constitute an unwarranted 
invasion of privacy, reveal trade secrets or privileged or 
confidential information, or be detrimental to the security of 
transportation. The protection of SSI is governed by 49 CFR part 
1520.
    \14\ Amendment procedures are in Sec. Sec.  1544.105(b), (c), 
and (d) and 1546.105(b), (c), and (d).
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    NCSP Recognition is a key component of TSA's effort to achieve 100% 
screening of inbound cargo. NCSP Recognition is TSA's process that 
recognizes a partner country's air cargo supply chain security system 
as being commensurate with TSA's domestic and international air cargo 
security requirements. NCSP Recognition reduces the burden on industry 
resulting from applying essentially duplicative measures under two 
different security programs (i.e., TSA's and the host country's 
programs), among other benefits. When approved by TSA, air carriers are 
able to follow the air cargo security measures of an NCSP recognized 
country in lieu of specific measures required by their security 
program.
    TSA regulations and security programs require carriers to perform 
screening procedures and security measures on all cargo inbound to the 
United States. TSA requires aircraft operators and foreign air carriers 
to determine the appropriate level of screening (baseline versus 
enhanced) to apply to the cargo, in accordance with the cargo 
acceptance methods and risk determination criteria contained within 
their TSA security programs. The difference between baseline and 
enhanced screening is the level to which the cargo must be screened and 
the procedures by which the specific screening technology must be 
applied as outlined in the carrier's security program.
    Baseline air cargo screening requirements (standard screening) 
depend on multiple factors, outlined in the carrier's security program. 
Baseline screening procedures for passenger air carriers require that 
100% of cargo loaded onboard the aircraft must be screened by TSA-
approved methods. These TSA-approved methods are set forth in the 
carrier's security program. Baseline screening procedures for all-cargo 
operations of inbound air cargo are different from the baseline 
screening procedures applied to air cargo in passenger operations 
because of the differing level of risk associated with all-cargo 
flights. The baseline screening measures applied to cargo on an all-
cargo aircraft are dependent on the types of cargo, among other 
factors. Enhanced security screening measures are for higher risk 
cargo. Cargo that the carrier determines is higher risk pursuant to the 
risk determination criteria in their security program must be screened 
via TSA-approved enhanced screening methods as set forth in the 
carrier's security program.
    TSA periodically inspects carriers' cargo facilities to ensure 
compliance with the required measures of the carriers' security 
programs. If TSA determines that violations of the requirements have 
occurred, appropriate measures will be taken and penalties may be 
levied.

B. Air Cargo Security Risks

    A terrorist attack on an international commercial flight via its 
air cargo continues to be a very real threat. DHS has received 
specific, classified intelligence that certain terrorist organizations 
seek to exploit vulnerabilities in international air cargo security to 
cause damage to infrastructure, injury, or loss of life in the United 
States or onboard aircraft. Enhancements to the current CBP regulations 
and TSA security programs will help address the in-flight risk and 
evolving threat posed by air cargo. While TSA requires carriers to 
perform air cargo screening in accordance with their security program 
prior to the cargo departing for the United States, ACAS enables an 
analysis of data and intelligence pertaining to a particular cargo 
shipment. As a result, additional high-risk cargo may be identified. 
Under current CBP regulations, a 19 CFR 122.48a filer is not required 
to transmit data to CBP until the aircraft departs for the United 
States or four hours prior to arrival in the United States. While this 
requirement provides CBP with the necessary data to target high-risk 
cargo prior to the aircraft's arrival in the United States, it does not 
allow sufficient time for targeting prior to the cargo being loaded 
onto a U.S.-bound aircraft. Therefore, additional time to target air 
cargo shipments would increase the ability of CBP and TSA to identify 
high-risk cargo that otherwise might not be identified until it was 
already en route to the United States.
    As explained in detail in the Executive Summary, terrorists have 
already exploited this security vulnerability by placing explosive 
devices aboard aircraft destined to the United States. After the 
October 2010 incident in which explosive devices concealed in two 
shipments of Hewlett-Packard printers addressed for delivery to Jewish 
organizations in Chicago, Illinois were discovered in cargo onboard 
aircraft destined to the United States, CBP and TSA determined that 
these evolving terrorist threats require a more systematic and targeted 
approach to identify high-risk cargo. With the existing security 
vulnerability, unauthorized weapons; explosive devices; WMDs; chemical, 
biological or radiological weapons; and/or other destructive items 
could be placed in air cargo on an aircraft destined to the United 
States, and potentially, be detonated in flight. The resulting 
terrorist attack could cause destruction of the aircraft, loss of life 
or serious injuries to passengers and crew, additional casualties on 
the ground, and disruptions to the airline industry.
    Since terrorists continue to seek out and develop innovative ways 
to thwart security measures, it is essential that CBP and TSA adapt 
their policies and use shared intelligence to address these evolving 
terrorist threats. To address the terrorist threat in 2010, CBP and TSA 
determined that it was essential to combine efforts to establish a 
coordinated policy to address aviation security. After consulting 
industry representatives and international partners, they decided that 
a risk-based assessment strategy utilizing real-time data and 
intelligence to target high-risk cargo earlier in the supply chain was 
essential. Such a strategy would deter terrorists from placing high-
risk, dangerous cargo on an aircraft, enable CBP and TSA to detect 
explosives, WMDs, chemical and/or biological weapons before they are 
loaded aboard aircraft, and reduce the threat of a terrorist attack 
from occurring in-flight.
    Specifically, CBP and TSA determined that certain advance air cargo 
data needs to be transmitted to CBP at the earliest point practicable 
in the supply chain, before the cargo is loaded onto the aircraft. This 
earlier time frame would provide sufficient time to target and identify 
high-risk cargo so that the relevant parties can take action as 
directed to mitigate the risk prior to the aircraft's departure. It was 
concluded that TSA's screening authority could be utilized to mitigate 
these risks. Therefore, in 2010, CBP and TSA established a joint CBP-
TSA targeting operation and launched an

[[Page 27386]]

ACAS pilot to collect the necessary data from pilot participants 
earlier in the process. The ACAS pilot is discussed in detail in 
Section III.C.
    The joint CBP-TSA targeting operation utilizes CBP's ATS and other 
available intelligence as a dynamic risk targeting tool to leverage the 
data and information already collected in order to secure inbound air 
cargo. This allows CBP and TSA to address specific threat information 
in real time and identify any cargo that has a nexus to terrorism. This 
cooperative targeting, in combination with the existing CBP and TSA air 
cargo risk assessment measures, increases the security of the global 
supply chain. The CBP-TSA joint targeting operation continues to 
operate today and together with the ACAS pilot, and now this rule, 
serves as an important additional layer of security to address the new 
and emerging threats to air cargo.

C. ACAS Pilot

    To collect advance air cargo data earlier in the supply chain, CBP, 
in collaboration with TSA and the air cargo industry, established the 
ACAS pilot in December 2010.\15\ The pilot was created to explore the 
feasibility of collecting data on inbound air cargo prior to loading, 
to determine the time frame under which participants could provide 
reasonably reliable and accurate data, and to test the technological 
aspects of transmitting the ACAS data and the operational logistics of 
resolving ACAS referrals.
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    \15\ On October 24, 2012, CBP published a general notice in the 
Federal Register (77 FR 65006) announcing the formalization and 
expansion of the ACAS pilot. Since then, CBP has published several 
additional Federal Register notices. The email address for the 
submission of applications and comments was corrected in 77 FR 65395 
(Oct. 26, 2012); the application period was reopened for 15 days in 
77 FR 76064 (Dec. 26, 2012); and the date of the close of the 
reopened application period was corrected in 78 FR 315 (Jan. 3, 
2013). On April 23, 2013, CBP published a notice in the Federal 
Register (78 FR 23946) extending the ACAS pilot period through 
October 26, 2013, and reopening the application period through May 
23, 2013. On October 23, 2013, CBP published a notice in the Federal 
Register (78 FR 63237) extending the ACAS pilot program through July 
26, 2014, and reopening the application period to accept 
applications from new ACAS pilot participants through December 23, 
2013. On July 28, 2014, CBP published a notice in the Federal 
Register (79 FR 43766) extending the ACAS pilot program through July 
26, 2015, and reopening the application period to accept 
applications from new ACAS pilot participants through September 26, 
2014. On July 27, 2015, CBP published a notice in the Federal 
Register (80 FR 44360) extending the ACAS pilot program through July 
26, 2016, and reopening the application period to accept 
applications from new ACAS pilot participants through October 26, 
2015. On July 22, 2016, CBP published a notice in the Federal 
Register (81 FR 47812) extending the ACAS pilot program through July 
26, 2017. On July 24, 2017, CBP published a notice in the Federal 
Register (82 FR 34319) extending the ACAS pilot program through July 
26, 2018.
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    Many different entities are participating in the pilot including 
express consignment air courier companies, passenger carriers, all-
cargo carriers, and freight forwarders. Pilot participants volunteer to 
electronically provide CBP with a specified subset of 19 CFR 122.48a 
data (ACAS pilot data) as early as possible prior to loading of the 
cargo onto an aircraft destined to the United States.
    To determine what data would be effective to target, identify, and 
mitigate high-risk cargo prior to loading, CBP evaluated the advance 
air cargo data that is currently transmitted under 19 CFR 122.48a. 
While the 19 CFR 122.48a data and the ACAS pilot data are used in 
conjunction to ensure the safety and security of air cargo throughout 
the supply chain, they are collected at different time frames for 
different risk assessments. The 19 CFR 122.48a data is used to evaluate 
risk prior to arrival at a U.S. port of entry to prevent high-risk 
cargo from entering the United States. ACAS pilot data is essential to 
ensure that high-risk cargo that poses a risk to the aircraft during 
flight is not loaded. Accordingly, CBP evaluated each 19 CFR 122.48a 
data element to determine whether the data would be effective in 
assessing the cargo's risk prior to loading of the cargo onto the 
aircraft, and whether the data was consistently available and 
predictable early in the lifecycle of the cargo in the global supply 
chain. CBP also consulted with the industry about what data would be 
available and predictable at an earlier time frame. CBP concluded that 
some of the 19 CFR 122.48a data, including the mandatory flight and 
routing information, was too unpredictable to effectively target high-
risk cargo under the earlier time frame.
    CBP determined that six of the mandatory 19 CFR 122.48a data 
elements, when viewed together, met its criteria and would be included 
in the ACAS pilot. This subset of 19 CFR 122.48a is the ACAS pilot 
data. The ACAS pilot data elements are: Air waybill number, total 
quantity based on the smallest external packing unit, total weight of 
cargo, cargo description, shipper name and address, and consignee name 
and address.\16\ These data elements must be provided to CBP at the 
lowest air waybill level (i.e., house air waybill level for 
consolidated shipments or regular air waybill level for non-
consolidated shipments).
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    \16\ The six ACAS data elements have been referred to by the 
trade as ``7+1'' data by considering ``shipper name and address'' 
and ``consignee name and address'' to be four data elements instead 
of two. As this data is included in 19 CFR 122.48a as two data 
elements, CBP will continue to refer to ``six ACAS data elements'' 
and not ``7+1.''
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    CBP determined that the data described above would enable the 
agency to more effectively conduct database searches aimed at 
identifying possible discrepancies and high-risk cargo. When taken 
together, the six data elements would provide CBP with pertinent 
information about the cargo and enable CBP to better evaluate the 
cargo's threat level prior to loading.
    While the ACAS pilot data only consists of six elements, CBP 
encourages participants to provide any additional available data. Any 
additional available data that is provided enhances the accuracy of the 
targeting.
    Upon receipt of the ACAS pilot data, the joint CBP-TSA targeting 
operation utilizes CBP's ATS and other intelligence to analyze the ACAS 
data to better identify cargo that has a nexus to terrorism and poses a 
high security risk. CBP issues an ACAS referral for any air cargo 
identified as high-risk and specifies what action the ACAS filer needs 
to take to address the referral and mitigate the risk. There are two 
types of referrals that may be issued after a risk assessment of the 
ACAS pilot data: Referrals for information and referrals for screening. 
The mitigation of these referrals depends on the directions provided by 
CBP and/or TSA. A referral for information is usually mitigated when 
the ACAS filer provides clarifying information related to the required 
ACAS pilot data. Referrals for screening are issued pursuant to CBP 
authorities and resolved using TSA-approved or accepted security 
programs.\17\ A referral for screening is mitigated by confirmation 
that enhanced screening has been performed pursuant to the appropriate 
TSA-approved screening methods contained in the carrier's security 
program.\18\ The inbound air carrier is prohibited from loading cargo

[[Page 27387]]

onto the aircraft destined for the United States until all ACAS 
referrals are resolved on that cargo.
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    \17\ TSA's involvement in ACAS is authorized under 49 U.S.C. 
114(f) and (m), and 44901(g), as amended by the Implementing 
Recommendations of the 9/11 Commission Act, Public Law 110-53, 121 
Stat. 266 (Aug. 3, 2007), and under authority of the Secretary of 
Homeland Security, as delegated to the Assistant Secretary of 
Homeland Security for TSA, under the Homeland Security Act of 2002, 
as amended (6 U.S.C. 112(b)).
    \18\ Under the ACAS pilot, industry participants regulated by 
TSA have been and will continue to be required to follow TSA's 
screening protocols as outlined in their respective security 
programs and applicable SDs/EAs. This includes baseline screening 
requirements for air cargo, as well as enhanced security screening 
measures for higher risk cargo. ACAS results may require that the 
carriers conduct enhanced screening procedures on certain cargo that 
otherwise would have received only baseline screening.
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    Based on the risk assessment, if CBP and TSA determine that the 
cargo may contain a potential bomb, improvised explosive device, or 
other material that may pose an immediate, lethal threat to the 
aircraft and/or its vicinity, CBP issues a DNL instruction. Cargo 
receiving a DNL instruction must not be transported. Such cargo 
requires adherence to the appropriate protocols and directions provided 
by the applicable law enforcement authority.
    The ACAS pilot has proven to be extremely beneficial. Most 
importantly, it has enabled CBP to identify numerous instances of high-
risk cargo prior to the cargo being loaded onto an aircraft destined to 
the United States. Although to date CBP has not had to issue a DNL 
instruction, CBP has identified a significant number of air cargo 
shipments that have potential ties to terrorism and, therefore, may 
represent a threat to aviation security. In each instance, enhanced 
cargo screening pursuant to the TSA-approved screening methods was 
required to ensure that the cargo presented no risk to the safety and 
security of the aircraft.
    Another benefit of the ACAS pilot is that an ACAS referral may 
require enhanced screening on cargo that otherwise would have received 
only baseline screening pursuant to TSA-approved screening methods in 
the carrier's security program. The ACAS pilot program is an additional 
layer of security in DHS's air cargo security approach. An additional 
benefit of the pilot is that it has allowed the industry to test the 
collection of the ACAS pilot data in the earlier time frame and the 
technological capacity to collect and transmit the data electronically.
    Despite the benefits, the pilot has certain limitations which stem 
from the fact that it is a voluntary program. Because the pilot is 
voluntary, not all inbound air carriers participate; thus, there is a 
data collection gap. Also, because the pilot is voluntary, not all ACAS 
pilot data is transmitted in a timely manner and not all ACAS referrals 
are resolved prior to departure. This means that high-risk cargo may be 
transported aboard U.S.-bound aircraft, placing the aircraft, 
passengers and crew at risk. Finally, because the pilot is voluntary, 
CBP cannot take enforcement action against participants who fail to 
transmit ACAS data in a timely manner, do not address an ACAS referral, 
or otherwise fail to comply with the requirements. While ACAS pilot 
participants usually transmit ACAS data in a timely manner, and take 
the necessary action to comply with ACAS referrals and other 
requirements, voluntary compliance is not always sufficient to ensure 
aviation security. Due to these limitations, air cargo continues to 
pose a security threat that can be exploited by terrorists. Therefore, 
CBP is establishing a mandatory ACAS program.

IV. Mandatory ACAS Program

    To fulfill the Trade Act mandate to ensure air cargo safety and 
security, CBP is establishing a mandatory ACAS program that will 
require the submission of certain advance air cargo data earlier than 
is required under 19 CFR 122.48a. This will enable CBP to identify, 
target and mitigate high-risk cargo before the cargo is transported 
aboard an aircraft destined to the United States. CBP's objective for 
the ACAS program is to obtain the most accurate data at the earliest 
time possible with as little impact to the flow of commerce as 
possible. CBP believes that the ACAS program, in conjunction with the 
current CBP 19 CFR 122.48a regulations and TSA's updated security 
programs, will significantly enhance air cargo safety and security as 
mandated by the Trade Act.
    In order to implement ACAS as a mandatory program, CBP must adhere 
to the parameters applicable to the development of regulations under 
section 343(a) of the Trade Act. While aviation security and securing 
the air cargo supply chain are paramount, these Trade Act parameters 
require CBP to give due consideration to the concerns of the industry 
and the flow of commerce. These parameters include, among others, 
provisions requiring consultation with the industry and consideration 
of the differences in commercial practices and operational practices 
among the different parties. In addition, the parameters require that 
the information collected pursuant to the regulations be used for 
ensuring cargo safety and security, preventing smuggling, and 
commercial risk assessment targeting, and require CBP to balance the 
impact on the flow of commerce with the impact on cargo safety and 
security. The parameters also require that the obligations imposed must 
generally be upon the party most likely to have direct knowledge of the 
required information and if not, then mandate that the obligations 
imposed take into account ordinary commercial practices for receiving 
data and what the party transmitting the information reasonably 
believes to be true. In developing the ACAS regulations, CBP considered 
all of the parameters. The adherence to these parameters is noted 
throughout the document.
    Throughout the development of the ACAS pilot and this interim final 
rule, CBP consulted extensively with the air cargo industry about their 
business practices and how to best formulate the ACAS program to take 
these business practices into consideration in developing a regulatory 
program that addressed the security concerns. As a result of these 
industry consultations, CBP has been able to develop ACAS regulations 
that, in accordance with the parameters of the Trade Act, balance the 
impact on the flow of commerce with the impact on cargo safety and 
security and take into consideration existing standard business 
practices and interactions among stakeholders. This allows CBP to 
target data earlier while minimizing negative impacts on operations, 
the air cargo business model, and the movement of legitimate goods.
    In developing these regulations, CBP also considered international 
efforts to develop advance air cargo information security programs. The 
ACAS program is part of a global effort to develop advance cargo 
information programs with agreed-upon international standards that 
collect and analyze the information prior to loading. CBP has 
participated in the World Customs Organization (WCO) Technical Experts 
Group Meeting on Air Cargo Security, the WCO/ICAO Joint Working Group 
on Advance Cargo Information and the WCO SAFE \19\ Working Groups 
meetings to inform foreign governments and trade associations on the 
progress of the ACAS pilot and to shape discussions on establishing 
global customs guidelines on air advance cargo information as well on 
identifying areas for collaboration between Customs and Aviation 
Security (AVSEC) authorities on air cargo security. In June 2015, the 
mandatory ACAS data established in this rule was incorporated into the 
WCO SAFE Framework of Standards.\20\ CBP believes that the ACAS program 
is consistent with these international programs.
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    \19\ Acronym for Framework of Standards to Secure and Facilitate 
Global Trade (``SAFE Framework of Standards'').
    \20\ The shipper name and address (referred to as the consignor 
per the WCO guidelines), consignee name and address, cargo 
description, piece count, weight and the air waybill number.
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    In developing the program, CBP also considered the results of the 
ACAS pilot. While the ACAS pilot has been operating successfully, CBP 
has noted a few areas for improvement. The ACAS program addresses these 
shortcomings. They include minor changes to the definition of consignee 
name and

[[Page 27388]]

address, adding the MAWB number as a conditional data element, 
requiring the submission of the FDM, and adding enforcement provisions. 
These issues are discussed in more detail in Sections IV.D., I., and J. 
below.
    To implement the ACAS program, CBP is adding a new section, 19 CFR 
122.48b, titled Air Cargo Advance Screening (ACAS), and making certain 
revisions to 19 CFR 122.48a. Additionally, CBP is revising the relevant 
bond provisions in 19 CFR part 113 to incorporate the ACAS 
requirements.

A. New 19 CFR 122.48b, Air Cargo Advance Screening (ACAS)

    The new ACAS regulation provides that, pursuant to section 343(a) 
of the Trade Act, for any inbound aircraft required to make entry under 
19 CFR 122.41 that will have commercial cargo aboard, CBP must 
electronically receive from the inbound air carrier and/or another 
eligible ACAS filer the ACAS data no later than the specified ACAS time 
frame.\21\ The required ACAS data must be transmitted to CBP through a 
CBP-approved EDI as early as practicable, but no later than prior to 
loading of the cargo on the aircraft. The ACAS data will be used to 
determine whether the cargo is high-risk and may result in the issuance 
of an ACAS referral or a DNL instruction. Any ACAS referral must be 
resolved prior to departure of the aircraft. Any cargo that is issued a 
DNL instruction must not be loaded onto aircraft and requires immediate 
adherence to the protocols and directions from law enforcement 
authorities. Below, we describe the new program including the eligible 
ACAS filers, the ACAS data, the ACAS referrals, DNL instructions, the 
bonds required to file ACAS data, and available enforcement actions.
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    \21\ As provided in 19 CFR 122.41, subject to specified 
exceptions, all aircraft coming into the United States from a 
foreign area must make entry.
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B. Eligible ACAS Filers

    The new 19 CFR 122.48b(c) specifies which parties are eligible to 
file ACAS data. Eligible parties include the inbound air carrier and 
other parties as specified below. The inbound air carrier is required 
to file the ACAS data if no other eligible party elects to file. CBP is 
allowing parties other than the inbound air carrier to file because, in 
some cases, these other parties will have access to accurate ACAS data 
sooner. For effective targeting to occur prior to loading, it is 
essential that the most accurate ACAS data be filed at the earliest 
point possible in the supply chain. This approach is consistent with 
the Trade Act parameters that require CBP to obtain data from the party 
most likely to have direct knowledge of the data and to balance the 
impact on the flow of commerce with the impact on cargo safety and 
security.
    In addition to the inbound air carrier, the other parties that may 
elect to file the ACAS data are all the parties eligible to elect to 
file advance air cargo data under 19 CFR 122.48a(c), as well as foreign 
indirect air carriers, a term which encompasses freight forwarders. 
Parties eligible to elect to file advance air cargo data under 19 CFR 
122.48a(c) include an Automated Broker Interface (ABI) filer (importer 
or its Customs broker) as identified by its ABI filer code; a Container 
Freight Station/deconsolidator as identified by its FIRMS (Facilities 
Information and Resources Management System) code; an Express 
Consignment Carrier Facility as identified by its FIRMS code; or, an 
air carrier as identified by its carrier IATA (International Air 
Transport Association) code, that arranged to have the inbound air 
carrier transport the cargo to the United States.
    Freight forwarders (also referred to as foreign indirect air 
carriers) are generally ineligible to directly file the advance air 
cargo data required under 19 CFR 122.48a. CBP decided to allow freight 
forwarders to participate in the ACAS pilot because HAWB data is 
generally available to the freight forwarder earlier than it is 
available to the inbound air carrier. CBP has concluded that the 
inclusion of freight forwarders in the ACAS pilot has resulted in CBP's 
receipt of the data earlier in some cases. Therefore, CBP is including 
freight forwarders as eligible filers under 19 CFR 122.48b.
    For purposes of ACAS, foreign indirect air carrier (FIAC) is 
defined as any person, not a citizen of the United States, that 
undertakes indirectly to engage in the air transportation of property. 
This is consistent with the definitions in the regulations of the 
Department of Transportation (14 CFR 297.3(d)) and the TSA (see 49 CFR 
1540.5, defining ``indirect air carrier''). This definition includes a 
foreign air freight forwarder, that is, a FIAC that is responsible for 
the transportation of property from the point of receipt to point of 
destination, and utilizes for the whole or any part of such 
transportation the services of a direct air carrier or its agent, or of 
another foreign indirect cargo air carrier. Certain FIACs, such as 
deconsolidators or ABI filers, may already be eligible to file ACAS 
data if they separately qualify as an eligible filer under 19 CFR 
122.48a(c). FIACs who are not eligible 19 CFR 122.48a filers are still 
eligible to transmit ACAS only filings.
    Under the new 19 CFR 122.48b(c)(3), all inbound air carriers and 
other eligible entities electing to be ACAS filers must meet the 
following prerequisites to file the ACAS data:
    <bullet> Establish the communication protocol required by CBP for 
properly transmitting an ACAS filing through a CBP-approved EDI 
system.\22\ As set forth in the new 19 CFR 122.48b(a), the ACAS data 
must be transmitted through such a system.
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    \22\ Instructions are currently set forth at https://www.cbp.gov/trade/automated/interconnection-security-agreement/instructions.
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    <bullet> Provide 24 hours/7 days a week contact information 
consisting of a telephone number and email address. CBP will use the 24 
hours/7 days a week contact information to notify, communicate, and 
carry out response protocols for a DNL instruction, even if an 
electronic status message is sent.
    <bullet> Report all of the originator codes that will be used to 
file ACAS data. (Originator codes are unique to each filer to allow CBP 
to know who initiated the filing and to identify the return address to 
provide status messages.) If, at any time, an ACAS filer wishes to 
utilize additional originator codes to file ACAS data, the originator 
codes must be reported to CBP prior to their use to ensure that CBP can 
link the ACAS data to the complete set of advance data transmitted 
pursuant to 19 CFR 122.48a. This will allow CBP to easily identify all 
the ACAS and 19 CFR 122.48a filers for one shipment.
    <bullet> Possess the appropriate bond containing all the necessary 
provisions of 19 CFR 113.62, 113.63, or 113.64. CBP is amending the 
regulations covering certain bond conditions, as described in Section 
IV.I., to incorporate the ACAS requirements.

C. Time Frame for Filing ACAS Data

    The new 19 CFR 122.48b(b) sets forth the time frame for submission 
of the ACAS data. As noted previously, the ACAS filing requirements are 
applicable to any inbound aircraft required to make entry under 19 CFR 
122.41 that will have commercial cargo aboard. (These same aircraft are 
subject to the requirements in 19 CFR 122.48a). For such aircraft, the 
ACAS data must be transmitted as early as practicable, but no later 
than prior to loading of the cargo onto the aircraft.\23\ Based on the

[[Page 27389]]

operation of the ACAS pilot, CBP believes that the ACAS time frame 
provides CBP sufficient time to perform a risk assessment prior to 
loading of the cargo aboard the aircraft without unduly impacting the 
flow of commerce.
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    \23\ If an aircraft en route to the United States stops at one 
or more foreign airports and cargo is loaded, an ACAS filing would 
be required for the cargo loaded on each leg of the flight prior to 
loading of that cargo.
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    Although CBP has determined that it is not commercially feasible to 
require the submission of the ACAS data a specified number of hours 
prior to loading of the cargo onto the aircraft, CBP encourages filers 
to transmit the required data as early as practicable. The earlier the 
ACAS data is filed, the sooner CBP can perform its targeting and the 
more time the filer or other responsible party will have to address any 
ACAS referral or DNL instruction. If the ACAS data is transmitted at 
the last minute and CBP issues an ACAS referral or DNL instruction, the 
scheduled departure of the flight could be delayed.

D. ACAS Data

    The ACAS data for the ACAS program is a subset of the 19 CFR 
122.48a data.\24\ It differs slightly from the ACAS pilot data. After 
an evaluation of the ACAS pilot, CBP determined that some improvements 
and additions to the data were needed. The ACAS data for the program is 
listed in the new 19 CFR 122.48b(d). As discussed below, some of the 
data is mandatory, one data element is conditional and other data 
elements are optional. ACAS data will only be used to the extent 
consistent with the Trade Act.
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    \24\ 19 CFR 122.48a specifies, based on the type of shipment, 
what data the inbound air carrier must transmit to CBP and what data 
other eligible filers may transmit to CBP. For non-consolidated 
shipments, the inbound air carrier must transmit to CBP the 17 data 
elements (11 mandatory, 6 conditional) applicable for the air 
waybill record. For consolidated shipments, the inbound air carrier 
must transmit to CBP the 17 data elements (11 mandatory, 6 
conditional) that are applicable to the MAWB, and the inbound air 
carrier must transmit a subset of the data (7 mandatory, 1 
conditional) for all associated HAWBs, unless another eligible filer 
transmits this data to CBP. For split shipments, the inbound air 
carrier must submit an additional subset of this data (9 mandatory, 
3 conditional) for each HAWB.
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1. ACAS Data Definitions
    The definitions of the ACAS data elements are set forth in 19 CFR 
122.48a. The relevant definitions for non-consolidated shipments are 
set forth in 19 CFR 122.48a(d)(1) and the relevant definitions for 
consolidated shipments are set forth in both 19 CFR 122.48a(d)(1) and 
(d)(2).
2. Mandatory ACAS Data
    The new 19 CFR 122.48b(d)(1) sets forth the mandatory ACAS data 
required in all circumstances. The mandatory ACAS data elements are the 
same six data elements as the ACAS pilot data. They are: shipper name 
and address, consignee name and address, cargo description, total 
quantity based on the smallest external packing unit, total weight of 
cargo, and air waybill number. As explained above in Section III.C., 
each of these six data elements provides CBP with crucial information 
needed to target and identify high-risk cargo before it is loaded onto 
an aircraft destined to the United States. CBP has determined that when 
taken together, these six data elements, if provided within the ACAS 
time frame, will enable CBP to perform an effective risk assessment. 
Based on the ACAS pilot, CBP believes that ACAS filers will be able to 
provide this data in a consistent, timely, and reasonably accurate 
manner.
    The ACAS data is required to be transmitted at the lowest air 
waybill level (i.e., at the HAWB level if applicable) by all ACAS 
filers. As explained in detail in Section IV.J.2., CBP is making minor 
changes to the definition of consignee name and address in 19 CFR 
122.48a(d) for clarity. The mandatory ACAS data elements for the ACAS 
program with the revised definition are:
    (1) Shipper name and address. The name and address of the foreign 
vendor, supplier, manufacturer, or other similar party is acceptable. 
The address of the foreign vendor, etc., must be a foreign address. The 
identity of a carrier, freight forwarder, or consolidator is not 
acceptable. (This definition is in 19 CFR 122.48a(d)(1)(x) for non-
consolidated shipments and in 19 CFR 122.48a(d)(2)(vi) for consolidated 
shipments.)
    (2) Consignee name and address. This is the name and address of the 
party to whom the cargo will be delivered regardless of the location of 
the party; this party need not be located at the arrival or destination 
port. (This definition is in revised 19 CFR 122.48a(d)(1)(xi) for non-
consolidated shipments and in revised 19 CFR 122.48a(d)(2)(vii) for 
consolidated shipments.)
    (3) Cargo description. A precise cargo description or the 6-digit 
Harmonized Tariff Schedule (HTS) number must be provided. Generic 
descriptions, specifically those such as ``FAK'' (``freight of all 
kinds''), ``general cargo,'' and ``STC'' (``said to contain'') are not 
acceptable. (This definition is in 19 CFR 122.48a(d)(1)(ix) for non-
consolidated shipments and in 19 CFR 122.48a(d)(2)(iii) for 
consolidated shipments.)
    (4) Total quantity based on the smallest external packing unit. For 
example, 2 pallets containing 50 pieces each would be considered 100, 
not 2. (This definition is in 19 CFR 122.48a(d)(1)(vii) for non-
consolidated shipments and in 19 CFR 122.48a(d)(2)(iv) for consolidated 
shipments.)
    (5) Total weight of cargo. This may be expressed in either pounds 
or kilograms. (This definition is in 19 CFR 122.48a(d)(1)(viii) for 
non-consolidated shipments and in 19 CFR 122.48a(d)(2)(v) for 
consolidated shipments.)
    (6) Air waybill number. The air waybill number must be the same in 
the ACAS filing and the 19 CFR 122.48a filing. For non-consolidated 
shipments, the air waybill number is the International Air Transport 
Association (IATA) standard 11-digit number, as provided in 19 CFR 
122.48a(d)(1)(i). For consolidated shipments, the air waybill number 
that is a mandatory data element for ACAS purposes is the HAWB number. 
As provided in 19 CFR 122.48a(d)(2)(i), the HAWB number may be up to 12 
alphanumeric characters (each alphanumeric character that is indicated 
on the HAWB must be included in the electronic transmission; alpha 
characters may not be eliminated).
3. Conditional ACAS Data: Master Air Waybill Number
    In addition to the mandatory ACAS data, CBP is adding the MAWB 
number as a conditional ACAS data element. As provided by 19 CFR 
122.48a(d) and (d)(1)(i), the MAWB number is the IATA standard 11-digit 
number. Although the MAWB number is one of the required 19 CFR 122.48a 
data elements for consolidated shipments, it is not an ACAS pilot data 
element. Based on CBP's experience with the pilot, CBP is including the 
MAWB number as an ACAS data element in certain situations. The new 19 
CFR 122.48b(d)(2) lists those situations. The inclusion of the MAWB 
number in the ACAS data will address several issues that have arisen 
during the pilot.
    CBP has found that oftentimes the transmitted ACAS pilot data by 
itself is insufficient to fully analyze whether the required ACAS data 
has been transmitted for a particular flight. This is because the ACAS 
pilot data only requires the data at the HAWB level. As a result, it 
provides data about the cargo and the relevant parties for a specific 
shipment but does not provide any data about the flight and routing of 
that shipment. Without that information, it is difficult to link the 
ACAS data with a particular flight and to estimate the time and airport 
of departure to the United States. This makes it difficult to

[[Page 27390]]

locate the cargo for risk mitigation. The MAWB data provides the 
necessary information about the flight and routing of the shipment.
    CBP also found that without the ability to link the HAWB number to 
a MAWB, the inbound air carrier might not be able to verify whether an 
ACAS assessment was performed for the cargo before it is accepted and 
loaded.
    CBP is requiring the MAWB number in the following situations:
    (1) When the ACAS filer is a different party from the party that 
will file the 19 CFR 122.48a data. The MAWB number is required in this 
situation because CBP needs a way to link the associated HAWBs 
transmitted as part of the ACAS data with the relevant MAWB provided by 
the 19 CFR 122.48a filer. To allow for earlier submission, an initial 
ACAS filing may be transmitted without the MAWB number, as long as the 
MAWB number is transmitted by the ACAS filer or the inbound air carrier 
according to the applicable ACAS time frame.
    (2) When the ACAS filer transmits all the 19 CFR 122.48a data in 
the applicable ACAS time frame through a single filing. Since the MAWB 
number is required 19 CFR 122.48a data for consolidated shipments, the 
ACAS filer will be providing the MAWB number by default in this single 
filing.
    (3) When the inbound air carrier would like to receive a status 
check from CBP on the ACAS assessment of specific cargo. If the MAWB 
number is transmitted, either by the ACAS filer or the inbound air 
carrier, CBP will be able to provide this information to the inbound 
air carrier upon request. If the MAWB number is not transmitted, CBP 
has no means of linking the ACAS data to a particular flight, as 
explained above, and cannot accurately respond to the query.
    CBP believes that requiring the MAWB number in these three 
situations and encouraging it in other situations, best balances the 
need to collect this important data without negatively impacting trade 
operations.\25\
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    \25\ As mandated by the Trade Act, CBP consulted with the 
industry regarding the feasibility of including the MAWB number as 
ACAS data. Some industry representatives indicated that providing 
the MAWB number early in the supply chain was not operationally 
feasible and would inhibit the transmission of the ACAS data as 
early as possible in the supply chain. Some express carriers stated 
that their guaranteed on-time delivery service required flexibility 
in their transportation routes and that current business practices 
do not involve assigning a MAWB number until the very last minute 
prior to departure. As a result, CBP decided to only require the 
MAWB number in certain situations where it was needed and/or could 
be reasonably provided.
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    When the MAWB number is required, it must be provided for each leg 
of the flight for any inbound aircraft required to make entry under 19 
CFR 122.41 that will have commercial cargo aboard.
4. Optional ACAS Data
    The new 19 CFR 122.48b(d)(3) lists optional data that may be 
provided by ACAS filers. ACAS filers may choose to designate a ``Second 
Notify Party,'' which is any secondary stakeholder or interested party 
in the importation of goods to the United States, to receive shipment 
status messages from CBP. This party does not have to be the inbound 
air carrier or eligible ACAS filer. Allowing ACAS filers the option of 
electing a ``Second Notify Party'' enables other relevant stakeholders 
to receive shipment status messages from CBP. This functionality will 
increase the ability to respond expeditiously to DNL instructions by 
warning additional stakeholders of such a situation through direct 
contact and automated data.
    ACAS filers are also encouraged to file additional information 
regarding any of the ACAS data (e.g., telephone number, email address, 
and/or internet protocol address for shipper and/or consignee) or any 
data listed in 19 CFR 122.48a that is not ACAS data. This additional 
data will assist CBP in its risk assessment and may allow for a faster 
ACAS disposition.
    CBP and/or TSA may also require additional information such as 
flight numbers and routing information to address ACAS referrals for 
screening. This information will be requested in a referral message, 
when necessary.

E. Filing and Updating the ACAS Data

    CBP's objective for the ACAS program is to obtain the most accurate 
data at the earliest time possible with as little impact to the flow of 
commerce as possible. To achieve this objective, CBP is allowing 
multiple parties to file the ACAS data, allowing flexibility in how the 
ACAS data is filed, and requiring that the ACAS data be disclosed to 
the filer by the parties in the supply chain with the best knowledge of 
the data.
    The eligible ACAS filers and the prerequisites to be an ACAS filer 
are described above in Section IV.B. If no other eligible filer elects 
to file, the inbound air carrier must file the ACAS data. Even if 
another eligible party does elect to file the ACAS data, the inbound 
air carrier may also choose to file.
    CBP allows flexibility in how the ACAS data is filed. As explained 
above in Section IV.D.3, an ACAS filer, who is also a 19 CFR 122.48a 
eligible filer, may choose to file the 19 CFR 122.48a filing in 
accordance with the ACAS time frame. This would be a single filing and 
would satisfy both the 19 CFR 122.48a and the ACAS filing requirements. 
Regardless of which party chooses to file or how they choose to file, 
the ACAS data must be transmitted to CBP within the ACAS time frame.
    To ensure that an ACAS filer has the most accurate ACAS data at the 
time of submission, CBP requires certain parties, with knowledge of the 
cargo, to provide the ACAS filer with the ACAS data.\26\ Specifically, 
the new 19 CFR 122.48b(c)(4) provides that when an eligible ACAS filer, 
who arranges for and/or delivers the cargo, does not elect to file the 
ACAS data, that party must fully disclose and present the inbound air 
carrier with the ACAS data. The inbound air carrier must then present 
this data electronically to CBP. The new 19 CFR 122.48b(c)(5) provides 
that any other entity that is not an eligible ACAS filer, but is in 
possession of ACAS data must fully disclose and present the ACAS data 
to either the inbound air carrier or other eligible ACAS filer, as 
applicable. The inbound air carrier or other eligible ACAS filer must 
then transmit such data to CBP.
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    \26\ This is in accordance with the Trade Act parameters. 
Section 343(a)(3)(B) provides that in general, the requirement to 
provide particular information shall be imposed on the party most 
likely to have direct knowledge of that information. It further 
provides that where requiring information from the party with direct 
knowledge of that information is not practicable, the regulations 
shall 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. It provides that where 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.
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    While CBP emphasizes the need for the ACAS data as early as 
possible in the supply chain, the ACAS filer is also responsible for 
updating the ACAS data, if any of the data changes or more accurate 
data becomes available. Updates are required up until the time the 19 
CFR 122.48a filing is required.\27\
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    \27\ The 19 CFR 122.48a data must be transmitted to CBP no later 
than the time of departure of the aircraft for the United States 
(from specified nearby foreign locations) or four hours prior to 
arrival in the United States for all other foreign locations. See 
Section III.A.1. for additional information on the 19 CFR 122.48a 
time frames.
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    When the ACAS filing is transmitted to CBP, the ACAS filer receives 
a status message confirming the submission. If the ACAS filer 
designates a Second Notify Party, that party will also receive the 
status notification (and any subsequent status notifications).\28\ 
After

[[Page 27391]]

the risk assessment of each cargo shipment is performed, the ACAS filer 
will receive either an ``ACAS assessment complete'' clearance message, 
an ACAS referral, or a DNL instruction.
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    \28\ If the inbound air carrier is neither the ACAS filer nor 
the Second Notify Party, the inbound air carrier can still obtain 
the ACAS status of a shipment if: (1) The ACAS filer submits the 
MAWB number, whether in the original ACAS filing or later. (This 
will allow the inbound air carrier to query CBP for any HAWBs under 
that MAWB number); or (2) The inbound air carrier submits a message 
to CBP containing the MAWB number and ACAS data from the HAWB that 
are exact matches to the ACAS data submitted by the original ACAS 
filer, allowing the inbound air carrier to receive the ACAS status 
of the HAWB; or (3) The inbound air carrier opts to resubmit the 
ACAS data previously filed by the other ACAS filer.
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F. ACAS Referrals

    After CBP conducts a risk assessment of the ACAS filing, an ACAS 
referral may be issued for cargo deemed high-risk or determined to have 
insufficient data. An ACAS referral is a designation attached to cargo 
to indicate that CBP and TSA need more accurate or more complete 
information, and/or that the information provided indicates a risk that 
requires mitigation pursuant to TSA-approved enhanced screening 
methods. CBP will send a shipment status message to the ACAS filer 
about the referral. The new 19 CFR 122.48b(e)(1) describes two types of 
potential ACAS referrals: referrals for information and referrals for 
screening.
    Referrals for information will be issued if a risk assessment of 
the cargo cannot be conducted due to non-descriptive, inaccurate, or 
insufficient data. This can be due to typographical errors, vague cargo 
descriptions, and/or unverifiable data. Referrals for screening will be 
issued if the potential risk of the cargo is deemed high enough to 
warrant enhanced security screening. The screening must be performed in 
accordance with the appropriate TSA-approved screening methods 
contained in the carrier's security program. For more information about 
TSA's screening requirements, see Section III.A.2.

G. Do-Not-Load (DNL) Instructions

    A DNL instruction will be issued if it is determined, based on the 
risk assessment and other intelligence, that the cargo may contain a 
potential bomb, improvised explosive device, or other material that may 
pose an immediate, lethal threat to the aircraft, persons aboard, and/
or the vicinity. Because a DNL instruction will be issued when it 
appears that a terrorist plot is in progress, all ACAS filers must 
provide a telephone number and email address that is monitored 24 
hours/7 days a week. All ACAS filers must respond and fully cooperate 
when the entity is reached by phone and/or email when a DNL instruction 
is issued.

H. Responsibilities of ACAS Filers

    Filing the ACAS data comes with certain responsibilities. Failure 
to fulfill these responsibilities could result in CBP issuing 
liquidated damages and/or assessing penalties. The inbound air carrier 
and/or the other eligible ACAS filer have the responsibility to provide 
accurate data to CBP in the ACAS filing and to update that data if 
necessary, to transmit the data within the ACAS time frame to CBP, to 
resolve ACAS referrals prior to departure of the aircraft and to 
respond to a DNL instruction in an expedited manner.
1. Responsibility To Provide Accurate and Timely Data
    CBP needs accurate and timely data to perform effective targeting. 
To ensure this, the inbound air carrier and/or other eligible ACAS 
filer is liable for the timeliness and accuracy of the data that they 
transmit. Accurate data is the best data available at the time of 
filing. The same considerations will apply here as for the current 
Trade Act requirements.
    As stated in the new 19 CFR 122.48b(c)(6), CBP will take into 
consideration how, in accordance with ordinary commercial practices, 
the ACAS filer acquired such data, and whether and how the filer is 
able to verify this data. Where the ACAS filer is not reasonably able 
to verify such information, CBP will permit the filer to electronically 
present the data on the basis of what that filer reasonably believes to 
be true. This is in accordance with the Trade Act parameters that 
require CBP to take these factors into account when promulgating 
regulations.
2. Responsibility To Resolve ACAS Referrals
    The new 19 CFR 122.48b(e)(2) specifies the requirements for 
resolving ACAS referrals. This section describes the responsibilities 
of the inbound air carrier and/or other eligible ACAS filer to take the 
necessary action to respond to and address any outstanding ACAS 
referrals no later than prior to departure of the aircraft.
    Each of the two types of ACAS referrals results in different 
responsibilities for the ACAS filer and/or inbound air carrier. The 
responsible party must address any ACAS referrals within the specified 
time frame. The new 19 CFR 122.48b(e)(3) specifies that the inbound air 
carrier is prohibited from transporting cargo on an aircraft destined 
to the United States until any and all referrals issued for that cargo 
have been resolved and CBP has provided an ``ACAS assessment complete'' 
clearance message.
a. Referral for Information
    For referrals for information, the party who filed the ACAS data 
must resolve the referral by providing CBP with the requested 
clarifying data. This responsibility is imposed on the party who filed 
the ACAS data because they are in the best position to correct any data 
inconsistencies or errors. The last party to file the ACAS data must 
address the referral. For instance, when the inbound air carrier 
retransmits an original ACAS filer's data and a referral for 
information is issued after this retransmission, the inbound air 
carrier is responsible for taking the necessary action to address the 
referral.
b. Referral for Screening
    All in-bound cargo must be screened in accordance with the TSA-
approved or accepted enhanced screening methods contained in the 
carrier's security program. If operating under an approved amendment to 
the security program, the measures specified in that amendment will 
apply whether that be a NCSP amendment or other amendment. TSA will 
amend security program requirements to be consistent with ACAS. Upon 
receipt of a referral for screening, the ACAS filer and/or inbound air 
carrier is required to respond with information on how the cargo was 
screened in accordance with TSA-approved or accepted enhanced screening 
methods.
    The ACAS filer can perform the necessary screening provided it is a 
party recognized by TSA to perform screening. If the filer chooses not 
to perform the screening or is not a party recognized by TSA to perform 
screening, the ACAS filer must notify the inbound air carrier of the 
referral for screening. Once the inbound air carrier is notified of the 
unresolved referral for screening, the inbound air carrier must perform 
the enhanced screening required, and/or provide the necessary 
information to TSA and/or CBP to resolve the referral for screening. 
The ultimate responsibility to resolve any outstanding referral for 
screening is placed on the inbound air carrier because that is the 
party with physical possession of the cargo prior to departure of the 
aircraft.
3. Responsibility To Address DNL Instructions
    The new 19 CFR 122.48b(f) specifies the requirements for a DNL 
instruction. A DNL instruction cannot be mitigated or resolved because 
of its urgency and the grave circumstances under which it is issued. A 
DNL instruction will be issued if it is determined that the cargo

[[Page 27392]]

may contain a potential bomb, improvised explosive device, or other 
material that may pose an immediate, lethal threat to the aircraft and/
or its vicinity. Accordingly, if a DNL is issued, the cargo must not be 
loaded onto the aircraft. The ACAS filer would be contacted by CBP and 
TSA using the 24/7 contact information provided, even if an electronic 
status message is sent, to notify, communicate, and carry out the 
necessary response protocols. The party in physical possession of the 
cargo at the time the DNL instruction is issued must adhere to the 
appropriate CBP and TSA protocols and the directions provided by the 
applicable law enforcement authority.

I. Amendments To Bond Conditions

    As described above, all ACAS filers have certain responsibilities 
under the ACAS program including the timely submission of ACAS data, 
and addressing ACAS referrals and DNL instructions prior to departure, 
among others. Under the ACAS program, failure to adhere to the ACAS 
requirements may result in CBP assessing liquidated damages and/or 
penalties. To ensure a proper enforcement mechanism exists, CBP is 
amending the relevant bond provisions to incorporate the ACAS 
requirements and to require all ACAS filers to have a bond. Although 19 
CFR 122.48a filers are already required to have a bond, freight 
forwarders, currently unregulated entities, will also be required to 
obtain a bond if they elect to file the ACAS data.
    Accordingly, CBP is adding a new condition to the relevant bond 
provisions in 19 CFR 113.62 (basic importation and entry bond) and in 
19 CFR 113.63 (basic custodial bond) to cover the ACAS requirements. 
Specifically, CBP is amending 19 CFR 113.62 and 113.63 to add a new 
paragraph that includes a bond condition whereby the principal agrees 
to comply with all ACAS requirements set forth in 19 CFR 122.48a and 
122.48b including, but not limited to, providing ACAS data to CBP in 
the manner and in the time period prescribed by regulation and taking 
the necessary action to address ACAS referrals and DNL instructions as 
prescribed by regulation.
    The amendments further provide that if the principal fails to 
comply with the requirements, the principal and surety (jointly and 
severally) agree to pay liquidated damages of $5,000 for each 
violation. CBP may also assess penalties for violation of the new ACAS 
regulations where CBP deems that such penalties are appropriate, e.g., 
pursuant to 19 U.S.C. 1436.
    The amendments also add a new condition to those provisions in 19 
CFR 113.64 required to be included in an international carrier bond. 
Specifically, CBP is amending 19 CFR 113.64 to add a new paragraph to 
include conditions whereby the principal, be it the inbound air carrier 
or other party providing ACAS data, agrees to comply with the ACAS 
requirements set forth in 19 CFR 122.48a and 122.48b including, but not 
limited to, providing ACAS data to CBP in the manner and in the time 
period prescribed by regulation and taking the necessary action to 
address ACAS referrals and DNL instructions as prescribed by 
regulation.
    This new paragraph further provides that if the principal fails to 
comply with the requirements, the principal and surety (jointly and 
severally) agree to pay liquidated damages of $5,000 for each 
violation, to a maximum of $100,000 per conveyance arrival. CBP may 
also assess penalties for violation of the new ACAS regulations where 
appropriate, e.g., pursuant to 19 U.S.C. 1436. The regulations also 
amend 19 CFR 113.64 to provide that, if a party who elects to file ACAS 
data incurs a penalty (or duty, tax or other charge), the principal and 
surety (jointly and severally) agree to pay the sum upon demand by CBP. 
CBP notes that the regulations in 19 CFR 113.64 already provide that 
the principal and surety agree to pay the sum upon demand by CBP when 
other parties, including an aircraft, owner of an aircraft, or person 
in charge of an aircraft, incur a penalty (or duty, tax or other 
charge).
    Due to the addition of the new ACAS paragraphs in 19 CFR 113.62, 
113.63, and 113.64, some of the other paragraphs in those sections are 
redesignated. Specifically, 19 CFR 113.62(l) and (m) are redesignated 
as 19 CFR 113.62(m) and (n); 19 CFR 113.63(h) and (i) are redesignated 
as 19 CFR 113.63(i) and (j), and 19 CFR 113.64(i) through (l) are 
redesignated as 19 CFR 113.64(j) through (m). Conforming changes are 
also made to 19 CFR 12.3, 141.113 and 192.

J. Amendments to 19 CFR 122.48a

    As discussed throughout this document, several revisions to 19 CFR 
122.48a are required to properly implement the ACAS program. This is 
because the ACAS regulation cites to provisions in 19 CFR 122.48a 
including the definitions of the ACAS data and the parties that are 
eligible to file the ACAS data. Additionally, as described below in 
Section IV.J.1., a new 19 CFR 122.48a data element, the FDM, is 
necessary to enforce the ACAS program.
1. Flight Departure Message (FDM)
    The FDM is an electronic message sent by the inbound air carrier to 
CBP when a flight leaves a foreign airport and is en route to the 
United States. Although neither the 19 CFR 122.48a regulations nor the 
ACAS pilot currently requires the submission of the FDM, some inbound 
air carriers voluntarily provide it.
    CBP is requiring the FDM as a mandatory 19 CFR 122.48a data 
element. The inbound air carrier is required to transmit the FDM to CBP 
for each leg of a flight en route to the United States within the 
specified time frames for transmitting 19 CFR 122.48a data. CBP 
welcomes comments on the timing of the FDM submission.
    The FDM is necessary for the proper enforcement of the ACAS 
program. It will provide CBP with the liftoff date and time from each 
foreign airport for a flight en route to the United States. This will 
allow CBP to easily assess whether an ACAS filing has been transmitted 
within the ACAS time frame and whether ACAS referrals and/or DNL 
instructions were addressed prior to the aircraft's departure. As a 
result, this will provide CBP with the information needed to determine 
whether an ACAS filer has complied with the ACAS requirements and 
responsibilities and whether to impose liquidated damages and/or assess 
penalties.
    Specifically, CBP is adding a new paragraph 19 CFR 
122.48a(d)(1)(xviii) that lists the FDM as a mandatory 19 CFR 122.48a 
data element. It further provides that the FDM includes the liftoff 
date and liftoff time using the Greenwich Mean Time (GMT)/Universal 
Time, Coordinated (UTC) at the time of departure from each foreign 
airport. It further provides that if an aircraft en route to the United 
States stops and cargo is loaded onboard at one or more foreign 
airports, the FDM must be provided for each departure.
2. Other Amendments to 19 CFR 122.48a
    CBP is making several other revisions to 19 CFR 122.48a. These 
include revisions to 19 CFR 122.48a(a), (c), and (d). Specifically, in 
19 CFR 122.48a(a), detailing general requirements, CBP is adding a 
sentence stating that the subset of data elements known as ACAS data is 
also subject to the requirements and time frame described in 19 CFR 
122.48b. Also, in 19 CFR 122.48a(a), CBP is making a minor change to 
the language regarding the scope of the advance data requirement. The 
current text states that

[[Page 27393]]

for any inbound aircraft required to enter under Sec.  122.41 that will 
have commercial cargo aboard, CBP must receive advance air cargo data. 
CBP is changing ``required to enter under Sec.  122.41'' to ``required 
to make entry under Sec.  122.41'' for clarity.
    In 19 CFR 122.48a(c), in order to more accurately reflect the 
obligations of the parties, CBP is making a minor change in the text. 
The current text states that where the inbound carrier receives advance 
cargo information from certain nonparticipating parties, the inbound 
carrier, on behalf of the party, must present this information 
electronically to CBP. CBP is of the view that the clause ``on behalf 
of the party'' improperly implies that the carrier is acting as the 
agent for the nonparticipating party and is therefore removing this 
clause.
    Additionally, in 19 CFR 122.48a(d), CBP is also adding the notation 
of an ``A'' next to any listed data element that is also an ACAS data 
element. This notated data is required during both the ACAS filing and 
the 19 CFR 122.48a filing.
    As discussed in Section IV.D., based on the operation of the ACAS 
pilot, CBP is amending the definition of consignee in order to have 
more information for risk assessment purposes. The current definition 
asks for the name and address of the party to whom the cargo will be 
delivered, and makes an exception for ``FROB'' (Foreign Cargo Remaining 
On Board). In the case of consolidated shipments, the current 
definition asks specifically for the address of the party to whom the 
cargo will be delivered in the United States. Due to the FROB exception 
and the United States address limitation, CBP may not know the ultimate 
destination of some cargo transiting the United States. The amendment 
removes the FROB exception and United States address limitation, and 
requires the name and address of the consignee regardless of the 
location of the party. This will allow for better targeting because it 
provides more complete information about where the cargo is going.

K. Flexible Enforcement

    In order to provide the trade sufficient time to adjust to the new 
requirements and in consideration of the business process changes that 
may be necessary to achieve full compliance, CBP will show restraint in 
enforcing the data submission requirements of the rule, taking into 
account difficulties that inbound air carriers and other eligible ACAS 
filers, particularly those that did not participate in the ACAS pilot, 
may face in complying with the rule, so long as inbound air carriers 
and other eligible ACAS filers are making significant progress toward 
compliance and are making a good faith effort to comply with the rule 
to the extent of their current ability. This CBP policy will last for 
twelve months after the effective date. While full enforcement will be 
phased in over this twelve month period, willful and egregious 
violators will be subject to enforcement actions at all times. CBP 
welcomes comments on this enforcement policy.

V. Statutory and Regulatory Reviews

A. Administrative Procedure Act

    The Administrative Procedure Act (APA) generally requires agencies 
to publish a notice of proposed rulemaking in the Federal Register (5 
U.S.C. 553(b)) and provide interested persons the opportunity to submit 
comments (5 U.S.C. 553(c)). However, the APA provides an exception to 
these requirements ``when the agency for good cause finds (and 
incorporates the finding and a brief statement of reasons therefor in 
the rules issued) that notice and public comment thereon are 
impracticable, unnecessary, or contrary to the public interest.'' 5 
U.S.C. 553(b)(B). The implementation of this rule as an interim final 
rule, with provisions for post-promulgation public comments, is based 
on this good cause exception. As explained below, delaying the 
implementation of this ACAS rule pending the completion of notice and 
comment procedures would be contrary to the public interest.
    DHS has determined that the potential exploitation by terrorists of 
existing inbound air cargo security arrangements exposes the United 
States to a significant new and emerging terrorist threat that would be 
effectively mitigated by the new ACAS rule. The intelligence community 
continues to acknowledge credible threats in the air environment, 
including the continued desire by terrorists to exploit the global air 
cargo supply chain. Moreover, DHS has received specific, classified 
intelligence that certain terrorist organizations seek to exploit 
vulnerabilities in international air cargo security to cause damage to 
infrastructure, injury, or loss of life in the United States or onboard 
aircraft. This ACAS rule mitigates these identified risks by providing 
CBP with the necessary data and additional time to perform necessary 
targeted risk assessments of air cargo before the aircraft departs for 
the United States. The rule strengthens DHS' ability to identify 
attempts by global terrorist organizations to exploit vulnerabilities 
in the air cargo as a means of conducting an attack. Delaying this rule 
to undertake notice and comment rulemaking would leave the United 
States unnecessarily vulnerable to a specific terrorist threat during 
the interval between the publication of the proposed and final rules 
and would be contrary to the public interest. Therefore, prompt 
implementation of this new ACAS rule is critical to reduce the 
terrorism risk to the United States and thereby protect the public 
safety. DHS has engaged in extensive consultation with stakeholders and 
has worked closely with the air cargo industry to address operational 
and logistical issues in the context of a voluntary pilot program in 
advance of this rulemaking, and has determined that this rule 
effectively addresses existing risks and emerging threats.
    For the reasons stated above, DHS has determined that this rule is 
not subject to a 30-day delayed effective date requirement pursuant to 
5 U.S.C. 553(d). Delaying this for 30 days after publication would 
leave the United States unnecessarily vulnerable to a specific 
terrorist threat and would be contrary to the public interest. 
Therefore, this rule is effective upon publication.
    Accordingly, DHS finds that it would be contrary to the public 
interest to delay the implementation of this rule to provide for prior 
public notice and comment and delayed effective date procedures. As 
such, DHS finds that under the good cause exception, this rule is 
exempt from the notice and comment and delayed effective date 
requirements of the APA. DHS is providing the public with the 
opportunity to comment without delaying implementation of this rule. 
DHS will respond to the comments received when it issues a final rule.

B. Executive Orders 12866, 13563, and 13771

    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 (including potential economic, environmental, 
public health and safety effects, distributive impacts, and equity). 
Executive Order 13563 emphasizes the importance of quantifying both 
costs and benefits, of reducing costs, of harmonizing rules, and of 
promoting flexibility. Executive Order 13771 (``Reducing Regulation and 
Controlling Regulatory Costs'') directs

[[Page 27394]]

agencies to reduce regulation and control regulatory costs and provides 
that ``for every one new regulation issued, at least two prior 
regulations be identified for elimination, and that the cost of planned 
regulations be prudently managed and controlled through a budgeting 
process.''
    As this rule has an impact of over $100 million in the first year, 
this rule is a significant regulatory action under section 3(f) of 
Executive Order 12866. Accordingly, OMB has reviewed this rule. 
Although this rule is a significant regulatory action, it is a 
regulation where a cost benefit analysis demonstrates that the primary, 
direct benefit is national security and the rule qualifies for a ``good 
cause'' exception under 5 U.S.C. 553(b)(B). The rule is thus exempt 
from the requirements of Executive Order 13771. See OMB's Memorandum 
titled ``Guidance Implementing Executive Order 13771, Titled `Reducing 
Regulation and Controlling Regulatory Costs' '' (April 5, 2017). A 
regulatory impact analysis, entitled Regulatory Assessment and Initial 
Regulatory Flexibility Analysis for the Interim Final Rule: Air Cargo 
Advance Screening (ACAS) Rule, has been included in the docket of this 
rulemaking (docket number [USCBP-2018-0019]). The following presents a 
summary of the aforementioned regulatory impact analysis.
1. Need and Purpose of the Rule
    CBP has identified a notable threat to global security in the air 
environment--the potential for terrorists to use the international air 
cargo system to place high-risk cargo, such as unauthorized weapons, 
explosives, or chemical and/or biological weapons, on a United States-
bound aircraft with the intent of bringing down the aircraft. In recent 
years, there have been several terrorist actions that highlighted this 
threat. In one notable incident in October 2010, concealed explosive 
devices that were intended to detonate during flight over the 
continental United States were discovered in cargo on board two 
aircraft destined to the United States. The exposure of international 
air cargo to such a threat requires a security strategy to detect, 
identify, and deter this threat at the earliest point in the 
international supply chain, before the cargo departs on an aircraft 
destined to the United States.
    The ACAS rule represents an important component of the U.S. 
Department of Homeland Security (DHS's) evolving layered strategy for 
securing the cargo supply chain from terrorist-related activities. The 
rule is designed to extend security measures out beyond the physical 
borders of the United States so that domestic ports and borders are not 
the first line of defense, with the objective of having better and more 
detailed information about all cargo prior to loading. The principal 
security benefit of the new rule will be a targeted risk assessment 
using real-time data and intelligence to make a more precise 
identification of high-risk shipments at an earlier time in the supply 
chain, prior the aircraft's departure. This information will allow for 
better targeting of cargo with potential ties to terrorist activity, 
reducing the risk of in-flight terrorist attacks intended to cause 
extensive casualties and inflict catastrophic damage to aircraft and 
other private property, and allowing sufficient time to take the 
necessary action to thwart a potential terrorist attack.
2. Synopsis
    In December 2010, CBP and TSA launched the Air Cargo Advance 
Screening (ACAS) pilot program. Participants in this pilot program 
transmit a subset of the 19 CFR 122.48a data as early as possible prior 
to loading of the cargo onto an aircraft destined to the United States. 
CBP and pilot participants believe this pilot program has proven 
successful by not only mitigating risks to the United States, but also 
minimizing costs to the private sector. As such, CBP is transitioning 
the ACAS pilot program into a permanent, mandatory program with only 
minimal changes from the pilot program.
    To give the reader a full understanding of the impacts of ACAS so 
they can consider the effect of the ACAS program as a whole, our 
analysis separately considers the impacts of ACAS during the pilot 
period (2011-2017), the regulatory period (2018-2027), and the combined 
period. For each time period, the baseline scenario is defined as the 
``world without ACAS.'' During the pilot period (2011-2017), the 
baseline includes non-ACAS-related costs incurred by industry and CBP 
in the absence of the pilot program. During the first ten years the 
interim final rule is likely to be in effect (2018-2027), the baseline 
similarly includes costs incurred by industry and CBP in the absence of 
any ACAS implementation (pilot program or interim final rule). For an 
accounting of the costs of the entire ACAS time period, including the 
pilot period and the regulatory period, see Table 3.
    During the pilot period, CBP estimates that CBP and 38 pilot 
participants incurred costs totaling between $112.8 million and $122.7 
million (in 2016 dollars) over the 6 years depending on the discount 
rate used (3 and 7 percent, respectively). CBP estimates that the rule 
will affect an estimated 215 entities and have an approximate total 
present value cost ranging from $245.7 million and $297.9 million (in 
2016 dollars) over the 10-year period of analysis, depending on the 
discount rate used (seven and three percent, respectively). As shown 
below in Table 1, the estimated annualized costs of ACAS range from 
$25.2 million to $26.1 million (in 2016 dollars) depending on the 
discount rate used. The cost estimates include both the one-time, 
upfront costs and recurring costs of the activities undertaken by the 
affected entities to comply with the rule, both in the pilot and the 
post-pilot periods.
    Due to data limitations, CBP is unable to monetize the benefits of 
the rule. Instead, CBP has conducted a ``break-even'' analysis, which 
shows how often a terrorist event must be avoided due to the rule for 
the benefits to equal or exceed the costs of the ACAS program. Table 1, 
below, shows the results of the break-even analysis under lower and 
higher consequence estimates of terrorist events. For the low cost 
consequence estimate, CBP estimates that ACAS must result in the 
avoidance of a terrorist attack event about every 7.7 to 8.0 months for 
the benefits of ACAS to equal the costs. For the higher cost 
consequence estimate, CBP estimates that the rule must result in the 
avoidance of a terrorist attack event about every 90.4 to 94 years for 
the benefits of ACAS to equal the costs.

[[Page 27395]]



                                                              Table 1--Summary of Findings
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                             Benefits of the regulation equal its costs
                                                                                                                              if: \1\
                                            Present value   Annualized costs                              ----------------------------------------------
              Discount rate                costs 2011-2027  2011- 2027 (2016    Economic consequences of   Number of events
                                           (2016 dollars)       dollars)          terrorist attack \2\       that must be      Critical event avoidance
                                              (million)         (million)                                    avoided in 17             rate \4\
                                                                                                               years \3\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Three Percent...........................            $410.8             $26.1  Lower Estimate.............              26.6  One event every 7.7 months.
                                                                              Higher Estimate............               0.2  One event every 90.4 years.
Seven Percent...........................             368.4              25.2  Lower Estimate.............              25.6  One event every 8.0 months.
                                                                              Higher Estimate............               0.2  One event every 94.0 years.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes:
\1\ Reflects the range of averted cost estimates associated with attack scenarios in TSA's TSSRA model involving the detonation of an explosive device
  on board a commercial passenger or one or multiple cargo aircraft destined to the United States that result in the destruction of the aircraft.
\2\ Results assume regulation reduces risk of a single type of attack only. The rule will likely reduce the risk of multiple numbers and types of
  attacks simultaneously.
\3\ Indicates the number of terrorist attack events that would have to be avoided in a single year for the avoided consequences of a successful
  terrorist attack to equal the costs of the rule.
\4\ Indicates the frequency at which the event would need to be averted for the avoided consequences of a successful terrorist attack to equal the costs
  of the rule.
Table Source: Adapted from Exhibit ES-6 of the full regulatory impact analysis included in the docket of this rulemaking, entitled Regulatory Assessment
  and Initial Regulatory Flexibility Analysis for the Interim Final Rule: Air Cargo Advance Screening (ACAS) Rule.

    Although the annualized costs of this rule are estimated to be less 
than $100 million dollars, the estimated first year costs are estimated 
to be approximately $104.1 million dollars. As such, the rule is 
considered an economically significant rulemaking, and, in accordance 
with OMB Circular A-4 and Executive Order 12866, CBP has provided 
accounting statements in Tables 2 and 3 reporting the estimated costs 
and benefits of the rule. Table 2 includes the costs and benefits for 
the post-pilot period (2018-2027) and Table 3 includes the costs and 
benefits across the entire ACAS period (2011-2027).

     Table 2--A-4 Accounting Statement: Cost of the Rule, 2018-2027
                                 [$2016]
------------------------------------------------------------------------
                                   3% Discount rate    7% Discount rate
------------------------------------------------------------------------
                               U.S. Costs
------------------------------------------------------------------------
Annualized monetized costs......  $36.0 million.....  $37.4 million.
Annualized quantified, but non-   None..............  None.
 monetized costs.
Qualitative (non-quantified)      Costs associated    Costs associated
 costs.                            with issuing a      with issuing a
                                   ``do not load,''    ``do not load,''
                                   which would         which would
                                   jointly result      jointly result
                                   from ACAS           from ACAS
                                   information and     information and
                                   information         information
                                   obtained from       obtained from
                                   intelligence        intelligence
                                   agencies and the    agencies and the
                                   governments of      governments of
                                   other countries.    other countries.
------------------------------------------------------------------------
                              U.S. Benefits
------------------------------------------------------------------------
Annualized monetized benefits...  None..............  None.
Annualized quantified, but non-   None..............  None.
 monetized benefits.
Qualitative (non-quantified)      Increased security  Increased security
 benefits.                         through the         through the
                                   targeting and       targeting and
                                   mitigation of       mitigation of
                                   threats posed by    threats posed by
                                   air cargo prior     air cargo prior
                                   to loading          to loading
                                   onboard aircraft    onboard aircraft
                                   destined to the     destined to the
                                   United States.      United States.
------------------------------------------------------------------------


 Table 3--A-4 Accounting Statement: Cost of the ACAS Program (Pilot and
                      Regulatory Period), 2011-2027
                                 [$2016]
------------------------------------------------------------------------
                                   3% Discount rate    7% Discount rate
------------------------------------------------------------------------
                               U.S. Costs
------------------------------------------------------------------------
Annualized monetized costs......  $26.1 million.....  $25.2 million.
Annualized quantified, but non-   None..............  None.
 monetized costs.

[[Page 27396]]

 
Qualitative (non-quantified)      Costs associated    Costs associated
 costs.                            with issuing a      with issuing a
                                   ``do not load,''    ``do not load,''
                                   which would         which would
                                   jointly result      jointly result
                                   from ACAS           from ACAS
                                   information and     information and
                                   information         information
                                   obtained from       obtained from
                                   intelligence        intelligence
                                   agencies and the    agencies and the
                                   governments of      governments of
                                   other countries.    other countries.
------------------------------------------------------------------------
                              U.S. Benefits
------------------------------------------------------------------------
Annualized monetized benefits...  None..............  None.
Annualized quantified, but non-   None..............  None.
 monetized benefits.
Qualitative (non-quantified)      Increased security  Increased security
 benefits.                         through the         through the
                                   targeting and       targeting and
                                   mitigation of       mitigation of
                                   threats posed by    threats posed by
                                   air cargo prior     air cargo prior
                                   to loading          to loading
                                   onboard aircraft    onboard aircraft
                                   destined to the     destined to the
                                   United States.      United States.
------------------------------------------------------------------------

3. Background
    In December 2010, CBP and TSA launched the Air Cargo Advance 
Screening (ACAS) pilot program. Participants in this pilot program 
transmit a subset of air manifest data elements (19 CFR 122.48a), as 
early as possible prior to loading of the cargo onto an aircraft 
destined to the United States. CBP believes this pilot program has 
proven successful by not only mitigating risks to the United States, 
but also minimizing costs to the private sector. CBP is, therefore, 
formalizing the pilot and making the ACAS program mandatory for any 
inbound aircraft required to make entry under 19 CFR 122.41 that will 
have commercial cargo aboard. CBP has, however, identified minor 
changes to the ACAS program that will increase the efficiency of 
targeting and mitigation of risks to air cargo destined to the United 
States. Specifically, CBP is making the following modifications from 
the pilot: (1) Minor modifications to the definition of the consignee 
name and address data element required under the pilot (see Table 4 for 
a description of each data element under the rule); (2) requiring the 
master air waybill (MAWB) number in certain circumstances (see Table 4 
for a more detailed explanation); (3) requiring inbound air carriers to 
provide the flight departure message (FDM) under the 19 CFR 122.48a 
time frames; \29\ and (4) requiring the filer to obtain a bond. CBP is 
amending the bond conditions to include an agreement to comply with 
ACAS requirements.
---------------------------------------------------------------------------

    \29\ In addition to the ACAS data elements described above, the 
regulations also require inbound carriers to transmit a flight 
departure message (FDM) to CBP upon departure or four hours prior to 
arrival in the United States (i.e., on the same timeframe as the 19 
CFR 122.48a data). The FDM is used for ACAS enforcement (i.e., to 
determine whether the ACAS filing was submitted on time), rather 
than targeting, and thus is not considered an ACAS data element. 
This information is already routinely provided by carriers on this 
timeframe and thus is not considered further in this analysis 
(Personal communication with Program Manager, Cargo and Conveyance 
Security Directorate, CBP, May 16, 2016.)

                       Table 4--ACAS Data Elements
------------------------------------------------------------------------
         Data element                          Description
------------------------------------------------------------------------
(1) Shipper name and address..  The name and address of the foreign
                                 vendor, supplier, manufacturer, or
                                 other similar party is acceptable. The
                                 address of the foreign vendor, etc.,
                                 must be a foreign address. The identity
                                 of a carrier, freight forwarder or
                                 consolidator is not acceptable.
(2) Consignee name and address  The name and address of the party to
                                 whom the cargo will be delivered
                                 regardless of the location of the
                                 party; this party need not be located
                                 at the arrival or destination port.
(3) Cargo description.........  A precise cargo description or the 6-
                                 digit Harmonized Tariff Schedule (HTS)
                                 number. Generic descriptions,
                                 specifically those such as ``FAK''
                                 (``freight of all kinds''), ``general
                                 cargo,'' and ``STC'' (``said to
                                 contain'') are not acceptable.
(4) Total quantity based on     For example, 2 pallets containing 50
 the smallest external packing   pieces each would be considered as 100,
 unit.                           not 2.
(5) Total weight of cargo.....  Weight of cargo expressed in either
                                 pounds or kilograms.
(6) Air waybill number........  For non-consolidated shipments, the air
                                 waybill number is the International Air
                                 Transport Association (IATA) standard
                                 11-digit number, as provided in 19 CFR
                                 122.48a(d)(1)(i). For consolidated
                                 shipments, the air waybill number is
                                 the HAWB number. As provided in 19 CFR
                                 122.48a(d)(2)(i), the HAWB number may
                                 be up to 12 alphanumeric characters
                                 (each alphanumeric character that is
                                 indicated on the HAWB must be included
                                 in the electronic transmission; alpha
                                 characters may not be eliminated). The
                                 air waybill number must be the same in
                                 the ACAS and 19 CFR 122.48a filings.
(7) Master air waybill number.  As provided in 19 CFR 122.48a(d)(1)(i),
                                 the MAWB number is the IATA standard 11-
                                 digit number.

[[Page 27397]]

 
                                The MAWB number is required under the
                                 following circumstances:
                                <bullet> The ACAS filer is also
                                 transmitting all the data elements
                                 required for the 19 CFR 122.48a filing
                                 under the ACAS time frame (i.e., in a
                                 single filing).\1\
                                <bullet> The inbound carrier wants the
                                 ability to receive status checks from
                                 CBP on the ACAS assessment of a
                                 specific shipment (e.g., for which the
                                 ACAS data were transmitted by another
                                 party such as a freight forwarder).\2\
                                <bullet> The ACAS filer is a different
                                 party from the party that will file the
                                 19 CFR 122.48a data for the cargo.\3\
(8) Second notify party         This optional data element allows other
 (optional).                     relevant stakeholders to receive
                                 shipment status messages from CBP. The
                                 filing of this data element is likely
                                 to be rare.\4\
------------------------------------------------------------------------
Notes:
\1\ Based on interviews with the trade, simultaneous submission of the
  ACAS data and the 19 CFR 122.48a filing is unlikely (see discussion in
  Chapter 3 of the full regulatory impact analysis).
\2\ In the latter two cases, the MAWB number does not need to be
  transmitted with the initial ACAS transmission and can be supplied
  later as long as it is under the ACAS time frame. For example, a
  freight forwarder can later transmit a carrier-issued MAWB number
  linking the MAWB and HAWB numbers, which then allows the carrier to
  receive status checks from CBP by referencing the MAWB number only. In
  addition to a freight forwarder updating an initial ACAS filing, an
  inbound carrier can be notified of the ACAS assessment of a shipment
  by transmitting the entire ACAS filing with MAWB and HAWB information.
  We note that based on our discussions with ACAS pilot participants,
  inbound carriers are unlikely to rely solely on an ACAS filing by a
  freight forwarder; rather, they will make their own ACAS transmission
  even if the data have previously been transmitted by a freight
  forwarder (see discussion in Chapter 3 of the full regulatory impact
  analysis).
\3\ The MAWB number is generally not required for express consignment
  shipments since most, if not all, express carriers or operators
  transmit both ACAS and 19 CFR 122.48a filings for shipments
  transported on their own aircraft or tendered to other carriers (see
  discussion in Chapter 3 of the full regulatory impact analysis).
\4\ Based on discussions with ACAS pilot participants.
Table Source: Adapted from Exhibit 1-1 of the full regulatory impact
  analysis included in the docket of this rulemaking, entitled
  Regulatory Assessment and Initial Regulatory Flexibility Analysis for
  the Interim Final Rule: Air Cargo Advance Screening (ACAS) Rule.

4. Baseline
    To give the reader a full understanding of the impacts of ACAS so 
they can consider the effect of the ACAS program as a whole, our 
analysis separately considers the impacts of ACAS during the pilot 
period (2011-2017), the regulatory period (2018-2027), and the combined 
period. For each time period, the baseline scenario is defined as the 
``world without ACAS.'' During the pilot period (2011-2017), the 
baseline includes non-ACAS-related costs incurred by industry and CBP 
in the absence of the pilot program. During the first ten years the 
interim final rule is likely to be in effect (2018-2027), the baseline 
similarly includes costs incurred by industry and CBP in the absence of 
any ACAS implementation (pilot program or interim final rule). For an 
accounting of the costs of the entire ACAS time period, including the 
pilot period and the regulatory period, see Table 3.
    To estimate the number of businesses affected by the pilot program 
we use historic data pilot participation. Table 5 shows 2015 ACAS 
participation by entity type. As shown, in 2015, 32 pilot participants 
combined to file over 80 million ACAS filings.

       Table 5--Estimated Number of Entities or Filers and Shipments Affected by the Pilot, by Entity Type
                                              [Calendar year 2015]
----------------------------------------------------------------------------------------------------------------
                                                                                                 Average number
                        Entity type                             Number of      Total number of   of ACAS filings
                                                              entities \1\      ACAS filings       per entity
----------------------------------------------------------------------------------------------------------------
Passenger Carriers........................................                11         2,518,699           228,973
Cargo Carriers............................................                 4           643,693           160,923
Express Carriers..........................................                 5        76,395,500        15,279,100
Freight Forwarders........................................                12         1,438,884           119,907
                                                           -----------------------------------------------------
    Total.................................................                32        80,996,776         2,531,149
----------------------------------------------------------------------------------------------------------------
Notes:
\1\ The number of entities includes both operational and data quality analysis pilot participants. It excludes
  one pilot participant that became inactive in 2016, and two participants whose entity types and operational
  status were unknown. CBP's 2013-2015 ACAS pilot program data listed a total of 35 entities; however, as of
  October 2016 CBP reports 32 operational and data quality participants.
Numbers may not sum due to rounding.
Table Source: Exhibit 3-4 of the full regulatory impact analysis included in the docket of this rulemaking,
  entitled Regulatory Assessment and Initial Regulatory Flexibility Analysis for the Interim Final Rule: Air
  Cargo Advance Screening (ACAS) Rule.

    To estimate the number of filers who would be affected by ACAS in 
the post-pilot period, we use the data on 19 CFR 122.48a filings for 
any inbound aircraft required to make entry under 19 CFR 122.41 that 
will have commercial cargo aboard. As the ACAS filing is a subset of 
the 19 CFR 122.48a data, these data serve as a good representation of 
the number of entities that would be affected by the rule. As shown in 
Table 6 below, using 2015 19 CFR 122.48a data, CBP has identified 293 
19 CFR 122.48a data filers that have filed approximately 93.6 million 
air waybills.\30\
---------------------------------------------------------------------------

    \30\ A small number of freight forwarders have participated in 
the ACAS pilot and may continue to make ACAS filings voluntarily 
when the rule is promulgated. Interviews with the trade, however, 
suggest that most freight forwarders who are not already 
participating are unlikely to begin participating in the future. For 
a more detailed discussion, please see Chapter 3 of the full 
regulatory impact analysis included in the docket of this rulemaking 
(docket number [USCBP-2018-0019]).

[[Page 27398]]



 Table 6--Estimated Number of Entities or Filers and Shipments Potentially Affected by the Rule, by Entity Type
                                              [Calendar year 2015]
----------------------------------------------------------------------------------------------------------------
                                                                                Number of air       Number of
                        Entity type                             Number of       waybills, in      shipments, in
                                                              entities \1\      millions \2\      millions \3\
----------------------------------------------------------------------------------------------------------------
Passenger Carriers........................................               129              7.87              4.23
Cargo Carriers............................................                56              2.26              1.74
Express Carriers..........................................                22              79.2              79.0
Freight Forwarders \4\....................................                83              4.30              4.29
Unknown \5\...............................................                 3              0.00              0.00
                                                           -----------------------------------------------------
    Total \6\.............................................               293              93.6              89.2
----------------------------------------------------------------------------------------------------------------
Notes:
\1\ Number of entities represents the number of unique filers identified in the ACE data after aggregating filer
  names and associated originator codes.
\2\ The number of air waybills may include master, house, and split air waybills filed under ACE, and is
  indicative of an entity's total volume of manifest transactions, rather than shipments.
\3\ Number of shipments based on the number of HAWBs filed under ACE.
\4\ Freight Forwarders included in this table are permitted to file the 19 CFR 122.48a data due to their
  additional classification by CBP as deconsolidators and broker/deconsolidators (71 entities with 4.03 million
  shipments). They also include those classified as brokers (12 entities with 0.27 million shipments).
\5\ The 2013 ACE data includes three filers for which the name and entity type could not be identified. These
  three filers had a combined number of only 73 air waybills and 17 HAWBs in 2013.
\6\ Numbers may not sum due to rounding.
Source: IEc analysis of ACE data provided by CBP's OFO on May 5, June 4, June 23, and July 3, 2014.
Table Source: Exhibit 2-2 of the full regulatory impact analysis included in the docket of this rulemaking,
  entitled Regulatory Assessment and Initial Regulatory Flexibility Analysis for the Interim Final Rule: Air
  Cargo Advance Screening (ACAS) Rule.

    Please see chapter 2 of the full regulatory impact analysis 
included in the docket of this rulemaking for additional information on 
the baseline analysis.
5. Costs
    During interviews with pilot program participants, key activities 
necessary for pilot participation were identified. As discussed in the 
full regulatory impact analysis, we developed a methodology for 
estimating associated pilot program costs, which are sunk costs for the 
purpose of deciding whether to continue the ACAS program in the future 
and are thus reported separately from costs in the 10-year period of 
analysis for the post-pilot period. These costs are useful when 
evaluating the effectiveness of the ACAS program as a whole, including 
the pilot and the post-pilot periods. Our methodology looked at the 
following activities: (1) Developing information and communication 
systems required to transmit the ACAS data elements as early as 
practicable; (2) training staff and providing outreach to trade 
partners on the ACAS requirements; (3) developing and implementing 
business protocols and operations to respond to and resolve ACAS 
referrals and address DNL instructions issued by CBP and establishing 
and providing 24 x 7 point of contact capabilities; and (4) responding 
to and resolving ACAS referrals issued by CBP (i.e., identify, locate, 
and/or screen cargo) and providing requested data to CBP. Below, Table 
7 presents the estimated costs of the ACAS pilot participants.

     Table 7--Total Estimated Costs of the ACAS Pilot Program for Industry by ACAS-Related Activity ($2016,
                                             Millions), 2013 to 2017
----------------------------------------------------------------------------------------------------------------
                                           Upfront, one-time costs              Recurring costs
                                   -----------------------------------------------------------------
               Year                               Training/    Protocols/                 Referral      Total
                                     IT systems    outreach    operations   IT systems    response
----------------------------------------------------------------------------------------------------------------
2013..............................         $3.4         $2.0         $7.6         $3.8         $0.7        $17.5
2014..............................          0.0          0.0          0.0          3.8          0.7          4.5
2015..............................          0.0          0.0          0.0          3.8          0.2          4.0
2016..............................          0.0          0.0          0.0          3.8          0.2          4.0
2017..............................          0.0          0.0          0.0          3.8          0.2          4.0
                                   -----------------------------------------------------------------------------
    Total (undiscounted)..........          3.4          2.0          7.6         18.9          2.0         34.0
                                   -----------------------------------------------------------------------------
    Total Present Value (3%                 3.7          2.2          8.3         19.5          2.1         35.9
     Discount Rate)...............
                                   -----------------------------------------------------------------------------
    Total Present Value (7%                 4.2          2.5          9.3         20.3          2.3         38.6
     Discount Rate)...............
----------------------------------------------------------------------------------------------------------------
Note: Numbers may not sum due to rounding.
Table Source: Exhibit ES-3 of the full regulatory impact analysis included in the docket of this rulemaking,
  entitled Regulatory Assessment and Initial Regulatory Flexibility Analysis for the Interim Final Rule: Air
  Cargo Advance Screening (ACAS) Rule.


[[Page 27399]]

    Given that the requirements of the rule are similar to those of the 
pilot program, the methodology developed to assess pilot program costs 
is used to estimate the incremental costs of the rule for both pilot 
program participants and non-participants over a 10-year post-pilot 
period of analysis (2018-2027). The most significant costs are the one-
time, upfront and recurring costs associated with developing and 
implementing the necessary protocols and operations to respond to and 
take the necessary action to address ACAS referrals. Total costs to 
industry are greatest for the passenger carriers, followed by cargo 
carriers, express carriers, and freight forwarders. The costs are 
greatest for passenger carriers, as a group, because they account for 
more than half of all regulated entities, and they tend not to be 
already fully operational under the ACAS pilot. In future years, 
express carriers and large freight forwarders are likely to experience 
higher costs on a per entity basis due to a higher transaction volume 
(i.e., greater number of ACAS filings).
    As shown in Table 8, CBP estimates that over a 10-year post-pilot 
period of analysis, the rule will approximately cost between a total 
present value of $245.7 million and $297.9 million (in 2016 dollars) 
assuming discount rates of seven and three percent, respectively. 
Annualized, it is estimated that this rule will cost between $36.0 
million and $37.4 million (in 2016 dollars) depending on the discount 
rate used. The cost estimates include both the one-time, upfront costs 
and recurring costs of the activities undertaken by the affected 
entities to comply with the rule.

           Table 8--Total Estimated Costs of the ACAS Rule by Entity Type ($2016, Millions), 2018-2027
----------------------------------------------------------------------------------------------------------------
                                                    Three percent discount rate     Seven percent discount rate
                                     Number of   ---------------------------------------------------------------
           Entity type               entities      Total present    Annualized     Total present    Annualized
                                                    value costs        costs        value costs        costs
----------------------------------------------------------------------------------------------------------------
Passenger Carrier...............             129           $91.4           $11.0           $78.3           $11.9
Cargo Carrier...................              56            38.4             4.6            32.9             5.0
Express Carrier.................              22            34.0             4.1            28.2             4.3
Freight Forwarder...............               8            13.8             1.7            11.0             1.7
Government......................             N/A           120.3            14.5            95.3            14.5
                                 -------------------------------------------------------------------------------
    Total.......................             215           297.9            36.0           245.7            37.4
----------------------------------------------------------------------------------------------------------------
Table Source: Exhibit 3-27 of the full regulatory impact analysis included in the docket of this rulemaking,
  entitled Regulatory Assessment and Initial Regulatory Flexibility Analysis for the Interim Final Rule: Air
  Cargo Advance Screening (ACAS) Rule.

    Please see chapter 3 of the full regulatory impact analysis 
included in the docket of this rulemaking for additional information on 
the cost analysis.
6. Benefits
    The purpose and intended benefit of this rule is that it would help 
prevent unauthorized weapons, explosives, chemical and/or biological 
weapons, weapons of mass destruction (WMDs) and other dangerous items 
from being loaded onto aircraft destined to the United States. As 
mentioned above, several incidents over the last several years have 
demonstrated the continued focus of terrorist actors to exploit 
vulnerabilities within the global supply chain. In order to continue to 
meet this threat, CBP and TSA must combine capabilities and scopes of 
authority to implement a comprehensive and tactical risk assessment 
capability. CBP needs certain information earlier in the process so 
that it can work with TSA to identify high-risk cargo before it is 
loaded onto an aircraft. The ACAS program is intended to satisfy this 
need. The results of the ACAS pilot program demonstrate that CBP is 
receiving actionable information in time to prevent dangerous cargo 
from being loaded onto an aircraft. Since the inception of the ACAS 
pilot program, CBP has identified a significant number of air cargo 
shipments that have potential ties to terrorism and, therefore, may 
represent a threat to the safety and security of the aircraft. In each 
instance, CBP issued ACAS referrals and the inbound air carrier or 
other eligible ACAS filer performed or confirmed the prior performance 
of enhanced cargo screening pursuant to TSA-approved methods.\31\
---------------------------------------------------------------------------

    \31\ If TSA's existing protocols identified a need for enhanced 
screening prior to the issuance of an ACAS referral, enhanced 
screening may have already been performed to satisfy the TSA 
requirements prior to the referral. In that case, the entity 
responsible for responding to the ACAS referral would resolve the 
referral for screening by confirming that enhanced screening had 
been performed.
---------------------------------------------------------------------------

    Ideally, the quantification and monetization of the benefits of 
this regulation would involve estimating the current baseline level of 
risk of a successful terrorist attack, absent this regulation, and the 
incremental reduction in risk resulting from implementation of the 
regulation. We would then multiply the change by an estimate of the 
value individuals place on such a risk reduction to produce a monetary 
estimate of benefits. However, existing data limitations prevent us 
from quantifying the incremental risk reduction attributable to this 
rule. As a result, we performed a ``break-even'' analysis to inform 
decision-makers of the frequency at which an attack would need to be 
averted for the avoided consequences of a successful terrorist attack 
to equal the costs of the rule (also referred to as the critical event 
avoidance rate).
    In the break-even analysis, we identified possible terrorist attack 
scenarios that may be prevented by the regulation. These scenarios and 
corresponding consequence data are identified using TSA's 
Transportation Sector Security Risk Assessment (TSSRA) 4.0 model. TSSRA 
4.0 is a Sensitive Security Information (SSI) \32\ report that was 
produced in response to DHS Appropriations legislation (Pub. L. 110-
396/Division D and Pub. L. 111-83), which requires DHS through TSA to 
conduct a comprehensive risk assessment. CBP reviewed TSSRA scenarios 
that involve the detonation of an explosive device onboard commercial 
aircraft destined to United States. The consequences include deaths, 
nonfatal injuries, property loss, and rescue and clean-up costs. The 
break-even analysis compares the annualized costs of the regulation to 
the avoided direct costs of each event to

[[Page 27400]]

estimate the number of events that would have to be avoided in a single 
year for the avoided consequences of a successful terrorist attack to 
equal the costs of the rule. The break-even results are also described 
in terms of risk reduction required, for example, a 0.25 reduction in 
the probability of an event occurring in a single year implies that one 
additional event must be avoided in a four-year period.
---------------------------------------------------------------------------

    \32\ ``Sensitive Security Information'' or ``SSI'' is 
information obtained or developed in the conduct of security 
activities, the disclosure of which would constitute an unwarranted 
invasion of privacy, reveal trade secrets or privileged or 
confidential information, or be detrimental to the security of 
transportation. The protection of SSI is governed by 49 CFR part 
1520.
---------------------------------------------------------------------------

    To allow the reader to evaluate the benefits of ACAS against both 
the post-pilot costs of the rule and the ACAS program as a whole, we 
include two break even analyses. Table 9, below, indicates what would 
need to occur for the post-pilot costs of the rule to equal the avoided 
consequences of a successful terrorist attack, assuming the rule only 
reduces the risk of a single type of attack. For the lower consequence 
estimate, CBP estimates the regulation must result in the avoidance of 
a terrorist attack event about every 5.4 to 5.6 months for the avoided 
consequences of a successful terrorist attack to equal the costs of the 
rule. For the higher consequence estimate, CBP estimates that the 
regulation must result in the avoidance of a terrorist attack event in 
a time period of about every 63.1 years to 65.7 years for the avoided 
consequences of a successful terrorist attack to equal the costs of the 
rule. These estimates reflect property loss, nonfatal injuries, and 
fatalities assumed in the TSSRA model. The value of avoided fatalities 
substantially increases the consequence estimates relative to the value 
of the other consequences such as nonfatal injury and property loss. 
Table 10 shows the same information for the entire ACAS period (2011-
2027).

                                          Table 9--Summary of Findings
----------------------------------------------------------------------------------------------------------------
                                                                            Benefits of the regulation equal its
                                                                                       costs if: \1\
                                   Annualized costs        Economic       --------------------------------------
          Discount rate             2018-2027 (2016     consequences of    Number of events
                                   million dollars)  terrorist attack \2\    that must be       Critical event
                                                                            avoided in ten    avoidance rate \4\
                                                                               years \3\
----------------------------------------------------------------------------------------------------------------
Three Percent....................             $36.0  Lower Estimate......              21.5  One event every 5.6
                                                                                              months.
                                                     Higher Estimate.....               0.2  One event every
                                                                                              65.7 years.
Seven Percent....................              37.4  Lower Estimate......              22.4  One event every 5.4
                                                                                              months.
                                                     Higher Estimate.....               0.2  One event every
                                                                                              63.1 years.
----------------------------------------------------------------------------------------------------------------
Notes:
\1\ Reflects the range of averted cost estimates associated with attack scenarios in TSA's TSSRA model involving
  the detonation of an explosive device on board a commercial passenger or one or multiple cargo aircraft
  destined to the United States where the aircraft is destroyed.
\2\ Results assume regulation reduces risk of a single type of attack only. The rule will likely reduce the risk
  of multiple numbers and types of attacks simultaneously.
\3\ Indicates the number of terrorist attack events that would have to be avoided in a single year for the
  avoided consequences of a successful terrorist attack to equal the costs of the rule.
\4\ Indicates the frequency at which the event would need to be averted for the avoided consequences of a
  successful terrorist attack to equal the costs of the rule.
Results rounded to two significant digits.
Table Source: Adapted from Exhibit 4-1 of the full regulatory impact analysis included in the docket of this
  rulemaking, entitled Regulatory Assessment and Initial Regulatory Flexibility Analysis for the Interim Final
  Rule: Air Cargo Advance Screening (ACAS) Rule.


                                          Table 10--Summary of Findings
----------------------------------------------------------------------------------------------------------------
                                                                            Benefits of the regulation equal its
                                                                                       costs if: \1\
                                   Annualized costs        Economic       --------------------------------------
          Discount rate             2011-2027 (2016     consequences of    Number of events
                                       dollars)      terrorist attack \2\    that must be       Critical event
                                                                             avoided in 17    avoidance rate \4\
                                                                               years \3\
----------------------------------------------------------------------------------------------------------------
Three Percent....................             $26.1  Lower Estimate......              26.6  One event every 7.7
                                                                                              months.
                                                     Higher Estimate.....               0.2  One event every
                                                                                              90.4 years.
Seven Percent....................              25.1  Lower Estimate......              25.6  One event every 8.0
                                                                                              months.
                                                     Higher Estimate.....               0.2  One event every
                                                                                              94.0 years.
----------------------------------------------------------------------------------------------------------------
Notes:
\1\ Reflects the range of averted cost estimates associated with attack scenarios in TSA's TSSRA model involving
  the detonation of an explosive device on board a commercial passenger or one or multiple cargo aircraft
  destined to the United States where the aircraft is destroyed.
\2\ Results assume regulation reduces risk of a single type of attack only. The rule will likely reduce the risk
  of multiple numbers and types of attacks simultaneously.
\3\ Indicates the number of terrorist attack events that would have to be avoided in a single year for the
  avoided consequences of a successful terrorist attack to equal the costs of the rule.
\4\ Indicates the frequency at which the event would need to be averted for the avoided consequences of a
  successful terrorist attack to equal the costs of the rule.
Results rounded to two significant digits.
Table Source: Adapted from Exhibit 4-2 of the full regulatory impact analysis included in the docket of this
  rulemaking, entitled Regulatory Assessment and Initial Regulatory Flexibility Analysis for the Interim Final
  Rule: Air Cargo Advance Screening (ACAS) Rule.

    Please see chapter 4 of the full regulatory impact analysis 
included in the docket of this rulemaking for additional information on 
the break-even analysis.
7. Alternatives
    In accordance with Executive Order 12866, the following three 
alternatives have been considered:
    (1) Alternative 1 (the chosen alternative): Six mandatory ACAS data 
elements and, as applicable, one conditional data element (the MAWB 
number) required no later than prior to loading of the cargo onto any 
inbound aircraft required to make entry under 19

[[Page 27401]]

CFR 122.41 that will have commercial cargo aboard;
    (2) Alternative 2: Six mandatory ACAS data elements and, as 
applicable, one conditional data element (the MAWB number), required no 
later than two hours prior to the estimated time of departure of any 
inbound aircraft required to make entry under 19 CFR 122.41 that will 
have commercial cargo aboard; and
    (3) Alternative 3: Same as Alternative 1, however, the one 
conditional ACAS data element, the MAWB number, is not required for any 
shipment.
    These three alternatives represent adjusting the required timing 
for ACAS transmittal and excluding a particular ACAS data element, 
namely the MAWB number. In comparison to Alternative 1 (the preferred 
alternative), Alternative 2 advances (makes earlier) the required time 
frame for ACAS transmission, which would provide CBP more time to 
conduct its risk assessment and mitigate any identified risk prior to 
aircraft departure. In comparison to Alternative 1, Alternative 3 
excludes the MAWB number data element for any shipment. In general, CBP 
needs to receive the MAWB number so that it can provide the location of 
the high-risk cargo and will allow CBP to associate the cargo with an 
ACAS submission. Some inbound carriers also prefer that the forwarder-
issued HAWB and carrier-issued MAWB numbers be linked so that they can 
verify that an ACAS assessment for a particular shipment they accepted 
from an ACAS-filing freight forwarder has been completed. However, some 
freight forwarders expressed issues with providing the MAWB number in 
time for the ACAS filings because they may not be finalized until just 
prior to aircraft departure. By evaluating these three alternatives, 
CBP is seeking the most favorable balance between security outcomes and 
impacts to air transportation. Based on this analysis of alternatives, 
CBP has determined that Alternative 1 provides the most favorable 
balance between security outcomes and impacts to air transportation.
    Please see chapter 5 of the full regulatory impact analysis 
included in the docket of this rulemaking for additional information on 
the alternatives analysis.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
federal agencies to examine the impact a rule would have on small 
entities. A small entity may be a small business (defined as any 
independently owned and operated business not dominant in its field 
that qualifies as a small business per the Small Business Act); a small 
not-for-profit organization; or a small governmental jurisdiction 
(locality with fewer than 50,000 people). Because this rule is being 
issued as an interim final rule under the good cause exception (5 
U.S.C. 553(b)(B)), as set forth above, a regulatory flexibility 
analysis is not required under the Regulatory Flexibility Act (5 U.S.C. 
601-612).
    Nonetheless, in the docket of this rulemaking (docket number 
[USCBP-2018-0019]), CBP has included a regulatory impact analysis 
entitled Regulatory Assessment and Initial Regulatory Flexibility 
Analysis for the Interim Final Rule: Air Cargo Advance Screening (ACAS) 
Rule. This document contains a threshold analysis that estimates the 
impacts of the rule on small entities.
    The threshold analysis identified that out of 215 total affected 
entities, 86 are U.S. entities and 61 U.S. entities of the 86 U.S. 
entities affected by this rule may be small businesses. These small 
entities are in 4 distinct industries and generally represent 50 
percent or more of their respective industries. As such, CBP believes 
that a substantial number of small entities may be affected by this 
rule. The threshold analysis also identified that the percentage of 
first-year costs relative to the average annual revenue of the small 
entities potentially affected by this rule range from a low of 0.4 
percent to a high of 1.3 percent. CBP believes that impacts identified 
in the threshold analysis may be considered a significant economic 
impact.
    CBP has prepared the following initial regulatory flexibility 
analysis. Please see chapter 5 of the full regulatory impact analysis 
included in the docket of this rulemaking for additional information on 
the threshold analysis.
    1. A description of the reasons why action by the agency is being 
considered.
    In October 2010, concealed explosive devices were discovered in 
cargo onboard two aircraft destined to the United States. This incident 
provides evidence of the potential for terrorists to use the 
international air cargo system to place high-risk cargo such as 
unauthorized weapons, explosives, chemical and/or biological weapons, 
WMDs, or other destructive substances or items in the cargo of a United 
States-bound aircraft with the intent of bringing down the aircraft. 
The exposure from international air cargo requires a security strategy 
to detect, identify, and deter this threat at the earliest point in the 
international supply chain, before the cargo departs for the United 
States.
    2. A succinct statement of the objectives of, and legal basis for, 
the rule.
    Current CBP regulations require air carriers to electronically 
transmit air manifest data in advance of their cargo's arrival in the 
United States (codified in 19 CFR 122.48a). These 19 CFR 122.48a data 
are required to be provided to CBP no later than the time of aircraft 
departure for the United States (from foreign ports in all of North 
America, including Mexico, Central America, the Caribbean, and Bermuda 
as well as South America north of the equator), or no later than four 
hours prior to aircraft arrival in the United States (from foreign 
ports located everywhere else). CBP determined, however, that it is 
necessary to receive a subset of the 122.48a data prior to loading of 
the cargo aboard the aircraft in order to more effectively complete its 
risk targeting and identification, and mitigate any identified risk, 
prior to aircraft departure.
    The rule, which was developed by CBP in coordination with the 
trade, including consultation with the Commercial Customs Operations 
Advisory Committee (COAC), represents an important component of DHS's 
evolving layered strategy for securing the cargo supply chain from 
terrorist-related activities. The rule is designed to identify high-
risk air cargo, such as unauthorized weapons, explosives, chemical and/
or biological weapons, WMDs, or other destructive substances or items 
prior to the aircraft's departure for the United States through a 
targeted intelligence-based risk assessment. The principal security 
benefit of the new rule will be more precise identification and 
mitigation of at-risk shipments prior to the departure of the U.S.-
bound aircraft. This information will allow for better targeting and 
will increase the safety of the aircraft during flight.
    3. A description of, and, where feasible, an estimate of the number 
of small entities to which the rule will apply.
    As discussed earlier in this section, the rule applies to 129 
passenger carriers, 56 cargo carriers, 22 air express couriers, and 8 
freight forwarders. Of these, 86 entities are U.S.-owned companies. 
Among the U.S.-owned companies, 61 meet SBA's definition of a small 
entity (See Table 11).

[[Page 27402]]



                 Table 11--Estimated Number of Potentially Affected U.S. Entities That Are Small
----------------------------------------------------------------------------------------------------------------
                                                                                  Number of U.S.
                                                                                   entities that   Proportion of
                                 Total number    Total number       SBA small       meet SBA'S     U.S. entities
Affected industry (NAICS code)    of affected     of affected     business size    definition of  that are small
                                 entities \1\    U.S. entities    standard \2\    a small entity        (%)
                                                                                        \3\
----------------------------------------------------------------------------------------------------------------
Scheduled Passenger Air                    129              30  1,500 employees.              18              60
 Transportation (481111).
Scheduled Freight Air                       56              31  1,500 employees.              27              87
 Transportation (481112).
Freight Transportation                       8               7  $15 million in                 3              43
 Arrangement (488510).                                           average annual
                                                                 receipts.
Air Courier and Express                     22              18  1,500 employees.              13              72
 Delivery Services (492110).
                               ---------------------------------------------------------------------------------
    Total.....................             215              86  N/A.............              61              71
----------------------------------------------------------------------------------------------------------------
Notes:
\1\ Some of the 215 entities are foreign-owned companies.
\2\ ``Table of Small Business Size Standards'', U.S. Small Business Administration, accessed at http://www.sba.gov/sites/default/files/Size_Standards_Table.pdf on October 3, 2016.
\3\ If no data were available, we assume the entity is small. This may overstate the number of small entities.
  None of the small entities identified were non-profit organizations.
Table Source: Exhibit 5-2 of the full regulatory impact analysis included in the docket of this rulemaking,
  entitled Regulatory Assessment and Initial Regulatory Flexibility Analysis for the Interim Final Rule: Air
  Cargo Advance Screening (ACAS) Rule.

    4. A description of the projected reporting, record-keeping and 
other compliance requirements of the rule, including an estimate of the 
classes of small entities that will be subject to the requirement and 
the type of professional skills necessary for preparation of the report 
or record.
    The rule requires the transmission of six mandatory ACAS data 
elements to CBP as early as practicable, but no later than prior to 
loading of the cargo onto any inbound aircraft required to make entry 
under 19 CFR 122.41 that will have commercial cargo aboard. The six 
ACAS data elements include: (1) Shipper name and address; (2) consignee 
name and address; (3) cargo description; (4) total quantity based on 
the smallest external packing unit; (5) total weight of cargo; and (6) 
air waybill number. The rule also requires the ACAS filer to transmit a 
MAWB number under certain conditions, as described in Chapter 1 of the 
full regulatory impact analysis.\33\ Filers will include passenger 
airlines (NAICS 481111), cargo-only airlines (NAICS 481112), freight 
forwarders (NAICS 488510), and air courier and express delivery 
services (NAICS 492110).
---------------------------------------------------------------------------

    \33\ In addition to the ACAS data elements described above, the 
regulations also require inbound carriers to transmit a flight 
departure message (FDM) to CBP upon departure or four hours prior to 
arrival in the United States (i.e., on the same timeframe as the 19 
CFR 122.48a data). This information is already routinely provided by 
carriers on this timeframe and thus is not considered further in 
this analysis (Personal communication with Program Manager, Cargo 
and Conveyance Security Directorate, CBP, May 16, 2016.)
---------------------------------------------------------------------------

    Generally, regulated entities will meet this requirement using 
existing information and communication systems; however, these systems, 
along with certain business processes, may require modification. In 
addition, some entities may purchase new systems or adopt new 
processes. In either case, new training will be required for existing 
staff (generally logistics professionals and support staff). In 
addition, entities will need to designate a 24/7 point of contact to 
respond to DNL instructions issued by CBP. Costs that may be incurred 
by these small entities in the first year of the rule are summarized in 
Table 12. For a detailed discussion of the derivation of the cost 
estimates, see Chapter 3 of the full regulatory impact analysis.

      Table 12--First Year Costs of the Interim Final Rule Relative to Average Annual Small Entity Revenues
----------------------------------------------------------------------------------------------------------------
                                                                                                  Percentage of
                                                             Cost per small    Average annual   first-year costs
                                           Number of small  entity for first     revenues of       relative to
     Affected industry (NAICS code)         U.S. entities     year of rule     small entities    average annual
                                                               ($2016) \1\       ($2016) \2\    revenues \3\ \4\
                                                                                                       (%)
----------------------------------------------------------------------------------------------------------------
Scheduled Passenger Air Transportation                  18          $420,000       $35,387,000               1.2
 (481111)...............................
Scheduled Freight Air Transportation                    27           420,000       120,408,000               0.3
 (481112)...............................
Freight Transportation Arrangement                       3            17,400         3,503,000               0.5
 (488510)...............................
Air Courier and Express Delivery                        13           325,000        48,845,000               0.7
 Services (492110)......................
----------------------------------------------------------------------------------------------------------------
Notes:
\1\ We assume that many small passenger and cargo carriers (as defined by SBA) incur costs identical to carriers
  transmitting 100 or more AWBs per year, while some may submit less and incur fewer costs. We assume small
  freight forwarders (as defined by SBA) transmit between 1,000 and 100,000 AWBs per year. We also assume small
  express carriers (as defined by SBA) transmit fewer than 15,000 AWBs per year.
\2\ Represents the average of the annual revenues of the entities that are small and for which we were able to
  obtain revenue data from Hoover's (26 small entities).
\3\ We also calculate these percentages using the average annual cost (based on analysis and data presented in
  Chapter 3) instead of first-year costs, finding percentages of 0.2 percent for passenger carriers, 0.1 percent
  for cargo carriers, 0.5 percent for freight forwarders, and 0.1 percent for air express couriers.

[[Page 27403]]

 
\4\ As a sensitivity analysis, we also report the first-year cost impacts for small passenger and cargo carriers
  using the lower AWB volumes reported in Chapter 3. Assuming small passenger and cargo carriers transmit fewer
  than 100 AWBs annually, the average costs equal 0.6 percent and 0.2 percent of revenues, respectively.
\5\ Costs are rounded to the nearest thousand. Totals may not calculate due to rounding.
Table Source: Exhibit 5-4 of the full regulatory impact analysis included in the docket of this, entitled
  Regulatory Assessment and Initial Regulatory Flexibility Analysis for the Interim Final Rule: Air Cargo
  Advance Screening (ACAS) Rule.

    5. An identification, to the extent practicable, of all relevant 
Federal rules which may duplicate, overlap or conflict with the rule.
    The data elements required to be transmitted in this rule are, 
largely, already required under existing Federal rules (i.e., 19 CFR 
122.48a). The main impact of this rule is to advance (make earlier) the 
time frame at which a subset of the existing 19 CFR 122.48a data 
elements for air cargo are required. Refer to Chapter 1 of the full 
regulatory impact analysis for further detail.
    6. An establishment of any significant alternatives to the rule 
that accomplish the stated objectives of applicable statutes and that 
minimize any significant economic impact of the rule on small entities.
    CBP does not identify any significant alternatives to the rule that 
specifically address small entities. Due to the security nature of the 
regulation, CBP is unable to provide an alternative regulatory 
framework for small entities that would not jeopardize the security of 
the United States. Excluding small entities would undermine the rule 
and increase in-flight security risks for aircraft operated by small 
entities. We evaluate two alternatives in our analysis, in addition to 
the chosen alternative; however as discussed in Chapter 3 of the full 
regulatory impact analysis, these alternatives affect all regulated 
entities.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires agencies to assess the effects of their regulatory actions on 
State, local, and tribal governments and the private sector. The 
regulation is exempt from these requirements under 2 U.S.C. 1503 
(Exclusions) which states that the UMRA ``shall not apply to any 
provision in a bill, joint resolution, amendment, motion, or conference 
report before Congress and any provision in a proposed or final Federal 
regulation'' that ``is necessary for the national security or the 
ratification or implementation of international treaty obligations.''

E. Privacy

    CBP will ensure that all Privacy Act requirements and policies are 
adhered to in the implementation of this rule, and will issue or update 
any necessary Privacy Impact Assessment and/or Privacy Act System of 
Records notice to fully outline processes that will ensure compliance 
with Privacy Act protections.

F. Paperwork Reduction Act

    An agency may not conduct, and a person is not required to respond 
to, a collection of information unless the collection of information 
displays a valid control number assigned by OMB. The collection of 
information regarding electronic information for air cargo required in 
advance of arrival under 19 CFR 122.48a was previously reviewed and 
approved by OMB in accordance with the requirements of the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3507) under OMB Control Number 1651-
0001. When CBP began the ACAS pilot, however, CBP did not publish the 
collection of information specific to the pilot for notice and comment 
under the Paperwork Reduction Act because there is no new burden 
associated with ACAS, just a change in when the data is submitted. Any 
additional cost to file the ACAS subset of the 19 CFR 122.48a filing on 
the ACAS time frame was not captured under the OMB Control Number 
mentioned above. CBP requests comment on what, if any, additional 
burden ACAS represents. CBP notes that when this rule is implemented, 
carriers will have the option to file the full 19 CFR 122.48a filing 
withn the ACAS time frame to satisfy both requirements in a single 
filing. Many carriers are able to submit their 19 CFR 122.48a 
information well in advance of the flight and this would allow them to 
only file once, if they choose to do so. This document adds an 
additional data element, the flight departure message, to 19 CFR 
122.48a and this collection. This data element is readily accessible 
for those filers for whom it is required and it is already routinely 
provided. The collection of information for ACAS under 19 CFR 122.48b 
is comprised of a subset of information already collected pursuant to 
19 CFR 122.48a under this approval, but information for ACAS will be 
now be collected earlier. Filers will need to modify their systems in 
order to provide these data earlier in an automated manner, but as the 
only new required data element (the flight departure message) is 
already routinely provided on a voluntary basis and is readily 
available, CBP does not estimate any change in the burden hours as a 
result of this rule.
    The resulting estimated burden associated with the electronic 
information for air cargo required in advance of arrival under this 
rule is as follows:
    Estimated Number of Respondents: 215.
    Estimated Number of Total Annual Responses: 1,466,400.
    Estimated Time per Response: 15 minutes.
    Estimated Total Annual Burden Hours: 366,600.
    Comments concerning the accuracy of this cost estimate and 
suggestions for reducing this burden should be directed to the Office 
of Management and Budget, Attention: Desk Officer for the Department of 
Homeland Security, Office of Information and Regulatory Affairs, at 
<a href="/cdn-cgi/l/email-protection#9dd9d5ced9f8eef6d2fbfbf4fef8efddf2f0ffb3f8f2edb3faf2eb"><span class="__cf_email__" data-cfemail="ca8e82998eafb9a185acaca3a9afb88aa5a7a8e4afa5bae4ada5bc">[email protected]</span></a>. A copy should also be sent to Regulations 
and Rulings, Office of Trade, U.S. Customs and Border Protection, 
Attention: Border Security Regulations Branch, 90 K Street NE, 10th 
Floor, Washington, DC 20229 or by email at <a href="/cdn-cgi/l/email-protection#3c7f7e6c636c6e7d7c5f5e4c1258544f125b534a"><span class="__cf_email__" data-cfemail="fcbfbeaca3acaebdbc9f9e8cd298948fd29b938a">[email protected]</span></a>.
    The list of approved information collections contained in 19 CFR 
part 178 is revised to add an appropriate reference to section 122.48b 
to reflect the approved information collection.

VI. Signing Authority

    The signing authority for this document falls under 19 CFR 0.2(a). 
Accordingly, this document is signed by the Secretary of Homeland 
Security.

List of Subjects

19 CFR Part 12

    Customs duties and inspection, Reporting and recordkeeping 
requirements.

19 CFR Part 113

    Common carriers, Customs duties and inspection, Exports, Freight, 
Laboratories, Reporting and recordkeeping requirements, Surety bonds.

19 CFR Part 122

    Administrative practice and procedure, Air carriers, Aircraft, 
Airports, Alcohol and alcoholic beverages, Cigars and cigarettes, 
Customs duties and inspection, Drug traffic control, Freight, 
Penalties,

[[Page 27404]]

Reporting and recordkeeping requirements, Security measures.

19 CFR Part 141

    Customs duties and inspection, Reporting and recordkeeping 
requirements.

19 CFR Part 178

    Reporting and recordkeeping requirements.

19 CFR Part 192

    Aircraft, Exports, Motor vehicles, Penalties, Reporting and 
recordkeeping requirements, Vessels.

Regulatory Amendments

    For the reasons set forth above, CBP amends parts 12, 113, 122, 
141, 178, and 192 of title 19 of the Code of Federal Regulations (19 
CFR parts 12, 113, 122, 141, 178, and 192) as follows:

PART 12--SPECIAL CLASSES OF MERCHANDISE

0
1. The general authority citation for part 12 and specific authority 
citation for Sec.  12.3 continue to read as follows:

    Authority:  5 U.S.C. 301; 19 U.S.C. 66, 1202 (General Note 3(i), 
Harmonized Tariff Schedule of the United States (HTSUS)), 1624.
* * * * *
    Section 12.3 also issued under 7 U.S.C. 135h, 21 U.S.C. 381;
* * * * *


Sec.  12.3   [Amended]

0
2. Amend Sec.  12.3(b)(2) and (c) by removing the references to ``Sec.  
113.62(m)(1)'' and adding in their place ``Sec.  113.62(n)(1)''.

PART 113--CBP BONDS

0
3. The general authority citation for part 113 continues to read as 
follows:

    Authority:  19 U.S.C. 66, 1623, 1624.
* * * * *

0
4. Amend Sec.  113.62 as follows:
0
a. Redesignate paragraphs (l) and (m) as paragraphs (m) and (n);
0
b. Add a new paragraph (l);
0
c. In redesignated paragraph (n)(1), remove the word ``or'' after the 
text ``(k)(2)'' and after the text ``(l)'', add ``, or (m)'';
0
d. In redesignated paragraph (n)(4), remove the reference to 
``paragraph (m)(1)'' and add in its place ``paragraph (n)(1)''; and
0
e. In redesignated paragraph (n)(5), remove the reference to 
``paragraph (l)'' and add in its place ``paragraph (m)''.
    The addition reads as follows:


Sec.  113.62   Basic importation and entry bond conditions.

* * * * *
    (l) Agreement to comply with Air Cargo Advance Screening (ACAS) 
requirements. The principal agrees to comply with all ACAS requirements 
set forth in Sec. Sec.  122.48a and 122.48b of this chapter including, 
but not limited to, providing ACAS data to U.S. Customs and Border 
Protection in the manner and in the time period prescribed by 
regulation and taking the necessary action to address ACAS referrals 
and Do-Not-Load (DNL) instructions as prescribed by regulation. 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.
* * * * *

0
5. Amend Sec.  113.63 by redesignating paragraphs (h) and (i) as 
paragraphs (i) and (j) and adding a new paragraph (h) to read as 
follows:


Sec.  113.63   Basic custodial bond conditions.

* * * * *
    (h) Agreement to comply with Air Cargo Advance Screening (ACAS) 
requirements. The principal agrees to comply with all ACAS requirements 
set forth in Sec. Sec.  122.48a and 122.48b of this chapter including, 
but not limited to, providing ACAS data to U.S. Customs and Border 
Protection in the manner and in the time period prescribed by 
regulation and taking the necessary action to address ACAS referrals 
and Do-Not-Load (DNL) instructions as prescribed by regulation. 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.
* * * * *

0
6. Amend Sec.  113.64 as follows:
0
a. In paragraph (a), add ``or Sec.  122.48b(c)(2)'' after the words 
``as specified in Sec.  122.48a(c)(1)(ii)-(c)(1)(iv)'';
0
b. Redesignate paragraphs (i) through (l) as paragraphs (j) through 
(m); and
0
c. Add a new paragraph (i) to read as follows:


Sec.  113.64   International carrier bond conditions.

* * * * *
    (i) Agreement to comply with Air Cargo Advance Screening (ACAS) 
requirements. (1) The inbound air carrier agrees to comply with all 
ACAS requirements set forth in Sec. Sec.  122.48a and 122.48b of this 
chapter including, but not limited to, providing ACAS data to U.S. 
Customs and Border Protection (CBP) in the manner and in the time 
period prescribed by regulation and taking the necessary action to 
address ACAS referrals and Do-Not-Load (DNL) instructions as prescribed 
by regulation. If the inbound air carrier, as 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, to a maximum of $100,000 per conveyance arrival.
    (2) If a party specified in Sec.  122.48b(c)(2) of this chapter 
provides the ACAS data to CBP, that party, as principal under this 
bond, agrees to comply with all ACAS requirements set forth in 
Sec. Sec.  122.48a and 122.48b of this chapter including, but not 
limited to, providing ACAS data to CBP in the manner and in the time 
period prescribed by regulation and taking the necessary action to 
address ACAS referrals and Do-Not-Load (DNL) instructions as prescribed 
by regulation. 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, to a maximum of 
$100,000 per conveyance arrival.
* * * * *

PART 122--AIR COMMERCE REGULATIONS

0
7. The general authority citation for part 122 continues to read as 
follows:

    Authority:  5 U.S.C. 301; 19 U.S.C. 58b, 66, 1431, 1433, 1436, 
1448, 1459, 1590, 1594, 1623, 1624, 1644, 1644a, 2071 note.
* * * * *

0
8. Amend Sec.  122.48a as follows:
0
a. Revise the introductory text of paragraph (a);
0
b. In paragraph (c)(3), remove the phrase ``, on behalf of the 
party,'';
0
c. In paragraph (d)(1) introductory text, add the phrase ``; and an 
``A'' next to any listed data element indicates that the data element 
is an ACAS data element that is also subject to the requirements and 
time frame specified in Sec.  122.48b'' before the closing parenthesis;
0
d. In paragraphs (d)(1)(i) and (d)(1)(vii)-(x), add the text ``(A)'' 
after the text ``(M)'';
0
e. Revise paragraph (d)(1)(xi);
0
f. In paragraph (d)(1)(xvi), remove the word ``and'' after the last 
semicolon;
0
g. In paragraph (d)(1)(xvii), remove the period and add in its place 
the text ``; and'';
0
h. Add paragraph (d)(1)(xviii);
0
i. In paragraph (d)(2) introductory text, add the phrase ``; and an 
``A'' next to any listed data element indicates that the data element 
is an ACAS data

[[Page 27405]]

element that is also subject to the requirements and time frame 
specified in Sec.  122.48b'' before the closing parenthesis;
0
j. In paragraphs (d)(2)(i) and (d)(2)(iii)-(vi), add the text ``(A)'' 
after the text ``(M)''; and
0
k. Revise paragraph (d)(2)(vii).
    The revisions and additions read as follows:


Sec.  122.48a   Electronic information for air cargo required in 
advance of arrival.

    (a) General requirement. Pursuant to section 343(a), Trade Act of 
2002, as amended (19 U.S.C. 2071 note), for any inbound aircraft 
required to make entry under Sec.  122.41, that will have commercial 
cargo aboard, U.S. Customs and Border Protection (CBP) must 
electronically receive from the inbound air carrier and, if applicable, 
an approved party as specified in paragraph (c)(1) of this section, 
certain information concerning the inbound cargo, as enumerated, 
respectively, in paragraphs (d)(1) and (d)(2) of this section. CBP must 
receive such information according to the time frames prescribed in 
paragraph (b) of this section. However, a subset of these data elements 
known as ACAS data and identified in paragraph (d) of this section, is 
also subject to the requirements and time frame described in Sec.  
122.48b. The advance electronic transmission of the required cargo 
information to CBP must be effected through a CBP-approved electronic 
data interchange system.
* * * * *
    (d) * * *
    (1) * * *
    (xi) Consignee name and address (M) (A) (for consolidated 
shipments, the identity of the container station (see 19 CFR 19.40-
19.49), express consignment or other carrier is sufficient for the 
master air waybill record; for non-consolidated shipments, the name and 
address of the party to whom the cargo will be delivered is required 
regardless of the location of the party; this party need not be located 
at the arrival or destination port);
* * * * *
    (xviii) Flight departure message (M) (this data element includes 
the liftoff date and liftoff time using the Greenwich Mean Time (GMT)/
Universal Time, Coordinated (UTC) at the time of departure from each 
foreign airport en route to the United States; if an aircraft en route 
to the United States stops at one or more foreign airports and cargo is 
loaded on board, the flight departure message must be provided for each 
departure).
    (2) * * *
    (vii) Consignee name and address (M) (A) (the name and address of 
the party to whom the cargo will be delivered is required regardless of 
the location of the party; this party need not be located at the 
arrival or destination port); and
* * * * *

0
9. Add Sec.  122.48b to read as follows:


Sec.  122.48b   Air Cargo Advance Screening (ACAS).

    (a) General requirement. Pursuant to section 343(a), Trade Act of 
2002, as amended (19 U.S.C. 2071 note), in addition to the advance 
filing requirements pursuant to Sec.  122.48a, for any inbound aircraft 
required to make entry under Sec.  122.41, that will have commercial 
cargo aboard, U.S. Customs and Border Protection (CBP) must 
electronically receive from the inbound air carrier and/or another 
eligible ACAS filer, as specified in paragraph (c) of this section, 
certain information concerning the inbound cargo, as enumerated in 
paragraph (d) of this section. CBP must receive such information, known 
as ACAS data, no later than the time frame prescribed in paragraph (b) 
of this section. The transmission of the required ACAS data to CBP 
(ACAS filing) must be effected through a CBP-approved electronic data 
interchange system. Any ACAS referrals must be resolved in accordance 
with the provisions and time frame prescribed in paragraph (e) of this 
section. Any Do-Not-Load (DNL) instruction must be addressed in 
accordance with the provisions prescribed in paragraph (f) of this 
section.
    (b) Time frame for presenting data. (1) Initial filing. The ACAS 
data must be submitted as early as practicable, but no later than prior 
to loading of the cargo onto the aircraft.
    (2) Update of ACAS filing. The party who submitted the initial ACAS 
filing pursuant to paragraph (a) of this section must update the 
initial filing if, after the filing is submitted, any of the submitted 
data changes or more accurate data becomes available. Updates are 
required up until the time frame specified in Sec.  122.48a(b) for 
submitting advance information under Sec.  122.48a(a).
    (c) Parties filing ACAS data--(1) Inbound air carrier. If no other 
eligible party elects to file the ACAS data, the inbound air carrier 
must file the ACAS data. If another eligible party does elect to file 
ACAS data, the inbound air carrier may also choose to file the ACAS 
data.
    (2) Other filers. The following entities can elect to be ACAS 
filers, provided they also meet the ACAS filer requirements in 
paragraph (c)(3) of this section:
    (i) All parties eligible to elect to file advance electronic cargo 
data listed in Sec.  122.48a(c); and
    (ii) Foreign Indirect Air Carriers. For purposes of this section, 
``foreign indirect air carrier'' (FIAC) is defined as any person, not a 
citizen of the United States, who undertakes indirectly to engage in 
the air transportation of property. A FIAC may volunteer to be an ACAS 
filer and accept responsibility for the submission of accurate and 
timely ACAS filings, as well as for taking the necessary action to 
address any referrals and Do-Not-Load (DNL) instructions when 
applicable.
    (3) ACAS filer requirements. All inbound air carriers and other 
entities electing to be ACAS filers must:
    (i) Establish the communication protocol required by CBP for 
properly transmitting an ACAS filing through a CBP-approved electronic 
data interchange system;
    (ii) Possess the appropriate bond containing all the necessary 
provisions of Sec.  113.62, Sec.  113.63, or Sec.  113.64 of this 
chapter;
    (iii) Report all of the originator codes that will be used to file 
ACAS data. If at any time, ACAS filers wish to utilize additional 
originator codes to file ACAS data, the originator code must be 
reported to CBP prior to its use; and
    (iv) Provide 24 hours/7 days a week contact information consisting 
of a telephone number and email address. CBP will use the 24 hours/7 
days a week contact information to notify, communicate, and carry out 
response protocols for Do-Not-Load (DNL) instructions, even if an 
electronic message is sent.
    (4) Nonparticipation by other party. If a party specified in 
paragraph (c)(2) of this section does not participate in an ACAS 
filing, the party that arranges for and/or delivers the cargo to the 
inbound air carrier must fully disclose and present to the inbound air 
carrier the required cargo data listed in paragraph (d) of this 
section; and the inbound air carrier must present this data 
electronically to CBP under paragraph (a) of this section.
    (5) Required information in possession of third party. Any other 
entity in possession of required ACAS data that is not the inbound air 
carrier or a party described in paragraph (c)(2) of this section must 
fully disclose and present the required data for the inbound air cargo 
to either the inbound air carrier or other eligible ACAS filer, as 
applicable, which must present such data to CBP.
    (6) Party receiving information believed to be accurate. Where the 
party electronically presenting the cargo data

[[Page 27406]]

required in paragraph (d) of this section receives any of this data 
from another party, CBP will take into consideration how, in accordance 
with ordinary commercial practices, the presenting party acquired such 
information, and whether and how the presenting party is able to verify 
this information. Where the presenting party is not reasonably able to 
verify such information, CBP will permit the party to electronically 
present the data on the basis of what that party reasonably believes to 
be true.
    (d) ACAS data elements. Some of the ACAS data elements are 
mandatory in all circumstances, one is conditional and is required only 
in certain circumstances, and others are optional. The definitions of 
the mandatory and conditional ACAS data elements are set forth in Sec.  
122.48a.
    (1) Mandatory data elements. The following data elements are 
required to be submitted at the lowest air waybill level (i.e., at the 
house air waybill level if applicable) by all ACAS filers:
    (i) Shipper name and address;
    (ii) Consignee name and address;
    (iii) Cargo description;
    (iv) Total quantity based on the smallest external packing unit;
    (v) Total weight of cargo; and
    (vi) Air waybill number. The air waybill number must be the same in 
the filing required by this section and the filing required by Sec.  
122.48a.
    (2) Conditional data element: Master air waybill number. The master 
air waybill (MAWB) number for each leg of the flight is a conditional 
data element. The MAWB number is a required data element in the 
following circumstances; otherwise, the submission of the MAWB number 
is optional, but encouraged:
    (i) When the ACAS filer is a different party than the party that 
will file the advance electronic air cargo data required by Sec.  
122.48a. To allow for earlier submission of the ACAS filing, the 
initial ACAS filing may be submitted without the MAWB number, as long 
as the MAWB number is later submitted by the ACAS filer or the inbound 
air carrier according to the applicable ACAS time frame for data 
submission in paragraph (b) of this section; or
    (ii) When the ACAS filer is transmitting all the data elements 
required by Sec.  122.48a according to the applicable ACAS time frame 
for data submission; or
    (iii) When the inbound air carrier would like to receive from CBP a 
check on the ACAS status of a specific shipment. If the MAWB number is 
submitted, either by the ACAS filer or the inbound air carrier, CBP 
will provide this information to the inbound air carrier upon request.
    (3) Optional data elements--(i) Second Notify Party. The ACAS filer 
may choose to designate a Second Notify Party to receive shipment 
status messages from CBP.
    (ii) Any additional data elements listed in Sec.  122.48a or any 
additional information regarding ACAS data elements (e.g., telephone 
number, email address, and/or internet protocol address for shipper 
and/or consignee) may be provided and are encouraged.
    (e) ACAS referrals--(1) Potential referrals. There are two types of 
referrals that may be issued by CBP after a risk assessment of an ACAS 
submission:
    (i) Referral for information. A referral for information will be 
issued if a risk assessment of the cargo cannot be conducted due to 
non-descriptive, inaccurate, or insufficient data. This can be due to 
typographical errors, vague cargo descriptions, and/or unverifiable 
information; and
    (ii) Referral for screening. A referral for screening will be 
issued if the potential risk of the cargo is deemed high enough to 
warrant enhanced screening. A referral for screening must be resolved 
according to TSA-approved enhanced screening methods.
    (2) ACAS referral resolution. All ACAS filers and/or inbound air 
carriers, as applicable, must respond to and take the necessary action 
to address all referrals as provided in paragraphs (e)(2)(i)-(ii) of 
this section, no later than prior to departure of the aircraft. The 
appropriate protocols and time frame for taking the necessary action to 
address these referrals must be followed as directed. The parties 
responsible for taking the necessary action to address ACAS referrals 
are as follows:
    (i) Referral for information. The ACAS filer is responsible for 
taking the necessary action to address a referral for information. The 
last party to file the ACAS data is responsible for such action. For 
instance, the inbound air carrier is responsible for taking the 
necessary action to address a referral for information if the inbound 
air carrier retransmits an original ACAS filer's data and the referral 
is issued after this retransmission.
    (ii) Referral for screening. As provided in paragraph (e)(1)(ii) of 
this section, a referral for screening must be resolved according to 
TSA-approved enhanced screening methods. If the ACAS filer is a party 
recognized by TSA to perform screening, the ACAS filer may address a 
referral for screening directly; if the ACAS filer is a party other 
than the inbound air carrier and chooses not to address the referral 
for screening or is not a party recognized by TSA to perform screening, 
the ACAS filer must notify the inbound air carrier of the referral for 
screening. The inbound air carrier is responsible for taking the 
necessary action to address a referral for screening, unless another 
ACAS filer recognized by TSA to perform screening has taken such 
action.
    (3) Prohibition on transporting cargo with unresolved ACAS 
referrals. The inbound air carrier may not transport cargo on an 
aircraft destined to the United States until any and all referrals 
issued pursuant to paragraph (e)(1) of this section with respect to 
such cargo have been resolved.
    (f) Do-Not-Load (DNL) instructions. (1) A Do-Not-Load (DNL) 
instruction will be issued if it is determined that the cargo may 
contain a potential bomb, improvised explosive device, or other 
material that may pose an immediate, lethal threat to the aircraft and 
its vicinity.
    (2) As provided in paragraph (c)(3)(iv) of this section, all ACAS 
filers must provide a telephone number and email address that is 
monitored 24 hours/7 days a week in case a Do-Not-Load (DNL) 
instruction is issued. All ACAS filers and/or inbound air carriers, as 
applicable, must respond and fully cooperate when the entity is reached 
by phone and/or email when a Do-Not-Load (DNL) instruction is issued. 
The party with physical possession of the cargo will be required to 
carry out the Do-Not-Load (DNL) protocols and the directions provided 
by law enforcement authorities.
    (3) The inbound air carrier may not transport cargo with a Do-Not-
Load (DNL) instruction.

PART 141--ENTRY OF MERCHANDISE

0
10. The general authority citation for part 141 and specific authority 
citation for Sec.  141.113 continue to read as follows:

    Authority:  19 U.S.C. 66, 1448, 1484, 1498, 1624.
* * * * *
    Section 141.113 also issued under 19 U.S.C. 1499, 1623.


Sec.  141.113   [Amended]

0
11. Amend Sec.  141.113(b) by removing the reference to ``Sec.  
113.62(m)(1)'' and adding in its place ``Sec.  113.62(n)(1)''.

PART 178--APPROVAL OF INFORMATION COLLECTION REQUIREMENTS

0
12. The authority citation for part 178 continues to read as follows:


[[Page 27407]]


    Authority:  5 U.S.C. 301; 19 U.S.C. 1624; 44 U.S.C. 3501 et seq.


Sec.  178.2   [Amended]

0
13. Amend Sec.  178.2 by removing ``Sec.  122.48a'' and adding in its 
place ``Sec. Sec.  122.48a, 122.48b''.

PART 192--EXPORT CONTROL

0
14. The authority citation for part 192 continues to read as follows:

    Authority:  19 U.S.C. 66, 1624, 1646c. Subpart A also issued 
under 19 U.S.C. 1627a, 1646a, 1646b; subpart B also issued under 13 
U.S.C. 303; 19 U.S.C. 2071 note; 46 U.S.C. 91.


Sec.  192.14   [Amended]

0
15. Amend Sec.  192.14(c)(4)(ii) by removing the reference to ``Sec.  
113.64(k)(2)'' and adding in its place ``Sec.  113.64(m)(2)''.

    Dated: June 4, 2018.
Kirstjen M. Nielsen,
Secretary.
[FR Doc. 2018-12315 Filed 6-11-18; 8:45 am]
 BILLING CODE 9111-14-P


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