The U.S. Customs Modernization and Informed Compliance Act: Implications for the Logistics Pipeline Available to Purchase

U.S. Customs administration plays an important role in the structure and efficiency of international logistics. The Customs Modernization and Informed Compliance Act was passed in December 1993 with the objective of improving the efficiency of the U.S. customs process. The principle logistics benefits for the trade community and the means by which they are to be accomplished include faster clearance and lower transaction costs via increased automation and remote entry, and decreased congestion at ports of entry via a reduction in the number and complexity of formal entries. These gains are offset somewhat because some traditional Customs responsibilities have been shifted to importers of record. This will increase their compliance costs and penalty risk exposure. The key changes presented in the act and potential implications for the parties involved in the importing process are described.