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Sandler, Travis and Rosenberg

I'll Go Anywhere as Long as It's Forward1: Upcoming Export Clearance Changes and Reengineering of the Automated Export System
Melissa Miller Proctor, Esq., Sandler, Travis and Rosenberg, P.A.

For those companies that were not able to attend the Bureau of Industry and Security's ("BIS") Update Conference on Export Controls and Policy, held in Washington, D.C. on July 23 through 25, 2013, this article provides an update on the latest developments surrounding the Automated Export System ("AES") reengineering initiative as well as the key AES changes that will go into effect on January 8, 2014. Traditional exporters as well as online retail/e-commerce exporters should be aware of these upcoming changes and ready themselves accordingly.

1. AES Reengineering and Migration to the Automated Commercial Environment
Earlier this year, U.S. Customs and Border Protection ("CBP") announced its plans to update the Automated Commercial Environment ("ACE"), which includes the reengineering of the AES. ACE is CBP's automated trade and risk management system. ACE was designed to automate border processing and provide a single, centralized access point to connect CBP, other government agencies, and the trade community. Many U.S. importers currently utilize ACE's account-based, expedited payment processing of duties and fees as well as track their import activities through customized account views and reports.

Even though ACE has been in existence for more than ten years, many of its intended features have not yet been deployed, including automated export processing. CBP and the U.S. Census Bureau are currently working together to migrate the existing AES to a new ACE platform which will automate export manifest, commodity, licensing and targeting activities. Note that the functions of the newly reengineered AES will not overlap with the USXPORTS system.2 The planned changes that will impact U.S. exports include:

  • Replacing manual or paper-based processing in exports for licensing, manifest and notifications with electronic processing
  • A single window that will allows CBP and other government agencies to view commodity, enforcement, licensing and findings data from a single application
  • An automated export license decrementation function for EAR (and ultimately ITAR) transactions
  • The insertion of placeholders in AES for new Export Control Classification Numbers ("ECCNs") proposed by the Commerce Department's Bureau of Industry and Security

At the Update 2013 Conference, CBP announced that it intends to publish an ACE deployment schedule in August 2013 and that the reengineered AES will likely be completed by September 2013. All of the ACE and AES changes are expected to be implemented by the end of 2015.

2. Upcoming AES Changes for U.S. Shippers
On March 14, 2013, the U.S. Census Bureau ("Census") published its Final Rule3 amending the Foreign Trade Regulations, which are slated to go into effect on January 8, 2014. The Final Rule imposes new export reporting requirements on shipments from the United States, including:

  • Requiring shippers to identify the type of ultimate consignee involved in the export (i.e., direct consumer, government entity, reseller, or other/unknown)
  • Requiring shippers to report license value, where the transaction is subject to an export license
  • Excluding from the scope of the Foreign Trade Regulations (and, accordingly, AES filing requirements) goods licensed by U.S. federal government agency where the country of ultimate destination is the United States or international waters (where person/entity receiving the items is a U.S. person)
  • Mandatory AES filing for imported goods rejected after entry into the United States - the value reported in AES must be the declared import value

With respect to postdeparture AES filing privileges under Option 4, CBP and Census will continue the moratorium on the acceptance of new applications. Option 4 allows approved companies (i.e., U.S. Principal Parties in Interest) to submit complete transaction data into AES up to ten days after exportation. Interested companies were required to submit applications to Census in order to become approved Option 4 filers.

For companies currently approved under Option 4, the following data elements will now be required to be reported in AES prior to departure:

  • USPPI information
  • Ultimate consignee
  • Filer ID number
  • Shipment reference number
  • Schedule B/HTS number
  • Product description
  • Port of export
  • Date of export
  • SCAC/IATA code (carrier code)
  • Conveyance name
  • License code (if needed)
  • Export Control Classification Number (ECCN) (if needed)

In addition, the AES filing timeframe for the remaining data elements will be reduced from ten (10) calendar days to five (5) calendar days following shipment from the United States.

In anticipation of these changes to the postdeparture reporting requirements, CBP and Census have announced that they will soon be launching the Advanced Export Information ("AEI") pilot program that will be open to all interested USPPIs.

3. Moving Forward with the New AES Developments
Both traditional exporters and online retailers/e-commerce companies should ensure that company personnel as well as their authorized AES filers understand what will be required when the new AES rules take effect in January. Companies are also advised to keep abreast of the developments in the AES reengineering initiative in order to ensure the seamless transition of their export clearance operations via the new ACE platform.


[1] David Livingstone, 19th century Scottish scholar and missionary
[2] Currently, export license applications are submitted via the State Department's electronic D-Trade system for goods subject to the International Traffic in Arms Regulations, and the Commerce Department's SNAP-R online system for dual-use items covered by the Export Administration Regulations. As a result of the Export Control Reform initiative, the Commerce and State Departments will soon migrate from SNAP-R and D-Trade over to the USXPORTS system, which is a platform used by the Department of Defense for its licensing activities.
[3] See 78 Federal Register 16366 (March 14, 2013); see also Notice of Proposed Rulemaking (76 Federal Register 4002; January 21, 2011).


Melissa Miller Proctor is a Member of Sandler, Travis and Rosenberg, P.A. and the firm's Export Practice Leader, resident in the Scottsdale, Arizona office. With significant experience in export controls, customs laws and regulations, and international trade, Melissa works closely with clients to expand their markets while ensuring their regulatory compliance. She may be reached at (480) 305-2110 or via e-mail at mproctor@strtrade.com.

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