September 25, 2015 Practice Points

CPSC Approves Pilot E-Filing System for Imports

By Charles E. Joern Jr.

The Consumer Product Safety Commission (CPSC) recently took an important step towards mandatory electronic filing of data for imported consumer products. On August 12, 2015, the commission approved an "Alpha Pilot" program designed to test an e-filing system for CPSC import data. The program will be conducted in conjunction with the U.S. Customs and Border Protection (CBP) and has two essential goals:

1. Enhance the CPSC's capacity to collect and analyze data in order to better target noncompliant products at import; and

2. Develop the means for importers to electronically file CPSC data through a "single window" in the CBP's Automated Commercial Environment (ACE) data system.

Importers of goods into the United States are often required to submit data to multiple government agencies. The Alpha Pilot will evaluate an e-filing system that importers of consumer products can use at the time goods are processed through U.S. Customs. The single window concept enables importers to submit data once - in a single location. Those data sets can then be used to comply with multiple government agency regulations.

The pilot program will also assist the CPSC in furthering its primary goal of targeting noncompliant goods at the point of entry and keeping them out of the country. In order to better accomplish that goal, the Alpha Pilot requires importers to electronically submit five data elements the CPSC considers minimally necessary to effectively target potentially violative imports. The Alpha Pilot's Federal Register Notice stated, "CPSC eventually plans to require electronic filing of either limited targeting /enforcement data or full certificate data to refine our risk assessment methodology and improve our import surveillance program."

Under the pilot, importers will have to submit the following five data elements:

1. Finished product identification;

2. Safety rule certification information;

3. The identity and location of the product manufacturer.

4. The name and contact information of the party who tested the product for certification; and

5. Check box confirmation that required certification exists for the finished product.

Importers will have the option of electronically filing the required data in one of two ways:

1. Inputting the actual individual data elements into the ACE system at the time of the goods' entry; or

2. Entering the specific data elements once into a CPSC created Data Registry and then referencing a Data Registry identifier when subsequently filing in the CBP's ACE system.

The CPSC created the Data Registry option in response to the strong concern of stakeholders that it would be impractical, if not nearly impossible, to require repeated entry of large amounts of data into various systems for the numerous products regularly imported into the U.S. The pilot program is intended to evaluate the feasibility and effectiveness of the Data Registry concept.

The Alpha Pilot program encompasses only CPSC regulated products and products on the Substantial Product Hazard List (Section 15(j)). Currently the CPSC requires certificates of compliance solely for specifically regulated products. By adding the "15(j)" category, the commission sends a message that in the future, it may also collect electronic targeting data on all potentially defective imported consumer products—not just those products subject to specific regulations. This would be a significant expansion of the CPSC's import surveillance scope. The CPSC is potentially laying the groundwork for such an expansion. In both the August 12th meeting approving the Alpha Pilot, and in the Federal Register Notice announcing the pilot, the CPSC made a point of citing its legal authority to expand import surveillance beyond "regulated" products.

The pilot program will begin in July 2016 and run for approximately six months. Presidential executive order EO 13659 requires designated federal agencies to begin using a "single window" to electronically receive all import related data by December 31, 2016. The CPSC is an independent federal agency and is not bound by the presidential order. The CSPC is nevertheless considered one of 14 government agencies critical to the single window program and the CPSC Chairman has made it a priority for the CPSC to limit the amount of time that the CPSC would operate outside the single window system.

The Federal Register notice is located on the U.S. Government Publishing Office's website.

Keywords: products liability, litigation, imports, Consumer Product Safety Commission, customs, electronic filing, single window, ACE

Charles E. Joern Jr. is with Joern Law Firm in Oak Brook, Illinois.


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