Memorandum of Understanding
The U.S. Department of the Treasury
U.S. Customs Service
The U.S. Department of Health and Human Services
Food and Drug Administration
The parties to this Memorandum of Understanding (MOU) are the U.S. Food and Drug Administration, hereinafter called FDA, and the U.S. Customs Service, hereinafter called Customs. These two agencies have a significant investment in interfacing their systems—in the case of Customs, the Automated Commercial System (ACS) and in the case of the FDA, the Import Support and Information System (ISIS). The purpose of this MOU is to recognize the importance the two agencies place on meeting the needs of the trading public in expediting the collection, processing and use of import information, while protecting the public health.
The objective of this Memorandum is to establish a test to collect, review and process commercial import data on FDA-regulated merchandise through the Automated Broker Interface (ABI). The pilot program will include an automated function to allow FDA to select entries which may be released without any further scrutiny. An FDA created and maintained screening file, resident on ACS, will be used to generate accurate and timely FDA response messages to the ABI filer and Customs. Screening file data elements consist of the FDA Product Code, FDA Actual Producer, FDA Actual Shipper, FDA Country of Production, and FDA Affirmation of Compliance Code. All entries, including those designated as "FDA May Proceed" will be transmitted electronically to FDA's Import Support and Information System (ISIS) for FDA processing. This processing will enable FDA to make admissibility and follow-up decisions and transmit these decisions electronically back to ACS. The pilot program will identify entries subject to liquidation pending FDA admissibility decisions. The pilot will also provide information on FDA entries subject to Fines, Penalties and Forfeitures. Successful evaluation of this pilot will set the groundwork for nationwide, port-by-port implementation plus future enhancements to the system capabilities to be addressed by amendment to this MOU. The functions and procedures developed for this pilot will result in better control for enforcement purposes and expedite admissibility decisions covering imported products under review by FDA utilizing electronic communication in lieu of paper documentation.
To accomplish these objectives, the two agencies will develop the capability to electronically collect, communicate and process data FDA currently receives through the submission of FDA paper notification (Form 701 and attachments). The FDA Form 701 is a requirement of entry (cargo release). FDA law enforcement function fall within the Food, Drug and Cosmetic Act (21 U.S.C.) and other related acts. Entries subject to FDA review without the FDA notification (Form 701) are rejected by the Customs Inspector.
In pursuit of this goal, both parties have agreed to conduct a pilot test of the interface between ACS and ISIS system at the ports of Seattle, Tacoma, and SeaTac Airport, Washington, starting in the 1st quarter of calendar 1992. After 90 days, a preliminary assessment of the system will be performed prior to extending it to other ports. The pilot will then be extended to the port of El Paso. The pilot will include a formal evaluation after six months by each party of the operations successes, costs, problems, etc. These evaluations shall be presented to the entire USCS/FDA Task Force within eight (8) months from the beginning of the pilot and carry recommendations either for continuing, modifying or expanding the pilot. This pilot can be extended for intervals of six months upon mutual agreement of both parties and an amendment to this MOU.
I. Customs Agrees To:
1. Provide FDA headquarters and pilot port offices, as designated by FDA, functional access to Customs' Automated Commercial System (ACS) to review entry data for FDA and to initiate administrative and enforcement actions.
2. Bear the cost of software development necessary in Customs Automated Commercial System for the pilot.
3. Collect data elements via ABI as defined in the FDA functional specifications for all FDA-regulated commodities and provide this information to FDA in a special file to be accessed only by FDA and Customs.
4. Provide specifications to the ABI filer requesting additional information pertaining to merchandise identified by FDA for review to be included as part of the entry transmission. This additional information together with appropriate data collected as part of the Customs transactions will be made available to FDA.
5. Identify Harmonized Tariff System (HTS) numbers in ACS as designated by FDA using the following indicators on the tariff record.
FD2 FDA notification 701 required
FD1 FDA notification 701 may be required
FD0 FDA notification 701 not required.
Provide FDA with technical guidance on HTS numbers and classification. Assess the impact on the enforcement and facilitation of imported cargo and advise FDA of the results of the analysis.
Assist FDA in proposing additional breakouts in the HTS to the "484E Committee" (Section 484E of the Tariff Classification Act of 1962 administered by the International Trade Commission) to provide more precise identification of products subject to FDA review. None of the foregoing is intended to limit FDA's role in determining the scope of the products it regulates, nor Customs' role in determining proper classification of such products.
Provide FDA with access to the database and data listings to verify completeness and accuracy.
Inform FDA in a timely fashion of all new numbers and changes to the statistical suffixes so that identifiers can be placed or removed on new numbers as necessary.
6. Continue to require FDA notification (Form 701) for pilot entries. Electronic filing of FDA entries without accompanying paperwork will be allowed on a product by product basis at the discretion of FDA. FDA entries not transmitted through ABI will continue to follow current procedures.
7. Create, with the assistance of FDA, an automated initial screening file, resident on ACS, based on information that FDA needs. This criteria consisting of the FDA Product Code, FDA Actual Producer, FDA Actual Shipper, FDA Country of Production, and FDA Affirmation of Compliance Code will flag certain merchandise recommended for FDA action. Initially, this criteria will cover only food and food-related commodities and later will be expanded to the full range of FDA-regulated merchandise. This file will complement and not replace the FDA screening file resident on ISIS.
8. Make ABI FDA entries available through this interface for processing by FDA/ISIS once the entries have been processed in selectivity. Allow FDA/ISIS to place admissibility designations electronically on FDA entries and communicate those decisions to the ABI filer. Allow FDA/ISIS to place disposition codes on FDA entries. Allow FDA access to relevant support files resident in ACS.
9. Conduct a training and orientation program for authorized FDA and Customs personnel that will enable them to access relevant portions of the Automated Commercial System (ACS). Also conduct training/orientation program designed for the ABI filer.
10. Assign a working-level Customs systems representative to facilitate communications and interactions between Customs, FDA and the trade. Assign technical (e.g., programming) personnel to develop and maintain the FDA/ISIS interface with ACS.
11. Load the product code file, the affirmation of compliance code file and any other files deemed necessary, provided by FDA, into the ACS computer and validate entry data using this information. Make the aforementioned information in the database available to the ABI filers through the automated system.
12. Electronically mark FDA entries through ACS so that Customs personnel are aware that admissibility has not been determined and liquidation should not proceed to finalization. This mark will be removed in a timely manner when FDA releases the merchandise or Customs issues a redelivery notice. Customs will maintain the responsibility for liquidation functions within ACS.
13. Develop an interface program for ISIS with Fines, Penalties and Forfeitures (FP&F) when the FP&F module has been redesigned and implemented. Until the FP&F module redesign is completed and the interface developed, make available FP&F case initiation information in the form of hard copy notices on FDA redelivery cases.
14. Transmit ABI data for all FDA regulated entries to FDA for processing/storage in a timely manner.
15. Continue processing non-ABI FDA entries through ACS as they are currently processed, assuring that FDA is notified of all FDA-regulated products.
II. FDA Agrees To:
1. Provide suitable communications capability between Parklawn Computer Center (PCC) and Customs Computer Center, Newington, Virginia. Install terminals at the processing site(s) (Seattle and El Paso) to process ABI transmitted FDA entries through ACS.
2. Reimburse Customs, if necessary, for communications and supporting hardware and software for the connection between the PCC and the Customs Computer Center and including each connection to the Consolidated Data Network (CDN). Transfer of funds will be by interagency agreement (Customs Form 236).
Install equipment in time to begin the pilot in the 1st quarter of calendar year 1992.
3. Provide Customs with a listing of the personnel authorized to access ACS to maintain FDA data. Ensure that only authorized personnel having NACI (National Agency Check and Inquiries) or BI (Background Investigation) checks are provided ACS security access codes. FDA personnel having access only to Food and Drug entries and related files (excluding FP&F cases) will be required to have successfully completed a favorable NACI according to Federal Personnel Manual (FPM) Chapter 736-13, Subchapter 3-3. FDA personnel accessing non-FDA entries and information must have successfully completed a favorable full field investigation according to the FPM Chapter 736-13, Subchapter 3-6.
Comply with Customs requirements regarding access to ACS information not included as part of the pilot.
4. Provide Customs with definitions of the additional data elements necessary for FDA entry review and admissibility decisions.
5. Provide Customs with a list of regulated HS tariff numbers identified with designator described in Part I, #5. Advise Customs, in writing, in a timely manner, of any changes to this listing. This listing will be made available to both ABI and non-ABI filers.
6. Provide Customs with a tape or other means of creating a database consisting of product codes and affirmation of compliance codes. Provide Customs with an alphabetical index covering product codes. Make corrections and updates in a timely manner and transmit to Customs as soon as possible.
7. Establish and maintain the FDA automated initial screening criteria file based on FDA data elements for use during the pilot.
8. FDA understands and acknowledges that the information maintained in the Automated Commercial System is highly sensitive commercial, financial, and proprietary information; should be reviewed only by authorized FDA personnel on a need to know basis and should be kept secure. FDA agrees that the information obtained will be used only for the purpose of enforcing FDA laws and regulations.
Only ACS source information available from the FDA Form 701 process, and which is commonly and publicly releasable, can be passed on to third parties. This does not include that which is proprietary commercial information, and exempt from disclosure pursuant to the FOIA (5 U.S.C. 552) or prohibited from disclosure by the Trade Secrets Act (18 U.S.C. 1905).
Non-FDA Form 701 process information may not be released to third parties (i.e., Member of Congress, Foreign Government, Federal, Stat or local agency, or FOIA requester) except as required by law or regulation. Further, in the event that there is a request from an above-mentioned third party for non-FDA Form 701 data, FDA agrees to consult and discuss with Customs on the disclosure of such information. No such information may be released without Customs express written permission. In the event of any unauthorized release by FDA personnel, FDA will intercede on Customs behalf and assume responsibility for any and all expenses, costs or liabilities arising therefrom. Such unauthorized disclosure may result in denial of future access to such data.
9. The information described in this MOU is transferred to the FDA from the U.S. Customs Service with the understanding that the FDA is in compliance with the Computer Security Act of 1987, Trade Secrets Act (18 U.S.C. 1905) which carriers personal liability, and OPM and OMB regulations concerning information security that are in effect at the time of transfer.
10. Assign a FDA systems representative to facilitate pilot communications and interactions between FDA, Customs, and the trade. Assign a technical representative to facilitate hardware, software and communication concerns.
11. Work with Customs personnel to conduct training and orientation of FDA, Customs, and trade participants.
III. It Is Mutually Understood And Agreed That:
1. The above provisions will be exercised to the extent authorized by law, Department of the Treasury and Department of Health and Human Services directives, statutes and regulations, and will be consistent with the respective agencies' missions.
2. All operational directives from either agency relative to the pilot will be jointly cleared by Customs and FDA within five (5) working days of receipt.
3. Changes to the ACS system required during the pilot test will be documented and agreed to by representatives of both agencies.
4. No transfer of Customs funds to FDA is required or contemplated under this MOU. If necessary, transfers of funds by FDA will be in accordance with the Interagency Agreement (Customs Form-236).
5. This document is an internal government agreement and is not intended to confer any right or benefit on any private person or party.
6. This Memorandum of Understanding shall become effective upon the date of final signature and is intended to be in force until terminated by either party upon 90 days notice or amended by mutual agreement of the undersigned.
7. Both agencies agree to process FDA entries on a timely basis to prevent unnecessary backlog of merchandise.
8. Additional databases may be created as necessary after full agreement between FDA and Customs.
9. Nothing in this agreement shall be interpreted as limiting, superseding, or otherwise affecting either agency's normal operations or decisions in carrying out its regulatory or law enforcement duties. This agreement is not intended to replace, limit, supersede, or otherwise affect other MOU's between the two agencies except to the extent necessary for proper implementation of the pilot.
10. Customs will not accept responsibility for delays caused by FDA.
11. Customs will program the FDA interface specifications to process FDA entries on ACS by FDA personnel. FDA will use the FDA processing features on ACS when ISIS cannot be used.
Approved and Accepted
Signed by: Carol Hallett
Date: August 9, 1991
Approved and Accepted
Signed by: David A. Kessler
Date: August 9, 1991