The Automated Export System (AES) has emerged as a game-changer in the world of international trade, transforming the way exporters and various stakeholders operate in the maritime industry. AES filing, a core component of this electronic platform, offers a myriad of benefits that have redefined export processes and compliance measures.
From ensuring adherence to export regulations to streamlining operations and enhancing data management, AES has proven its value across the maritime sector and beyond. In this article, we will explore the advantages of AES filing, shedding light on its efficiency, cost-effectiveness, and its vital role in safeguarding national security.
What is an AES Filing?
The Automated Export System is a collaborative effort overseen by the U.S. Census Bureau to gather essential export data from the United States. This electronic system involves various key entities, including Customs and Border Protection, Bureau of Industry and Security, Directorate of Defense Trade Controls, and members of the export trade community.
AES filing plays a crucial role in ensuring export security by capturing diverse export information and statistics. This process ensures compliance with export regulations, tracks export trends and economic indicators, and contributes to the calculation of the country’s Gross Domestic Product (GDP).
Additionally, on parcels, you might find a Customs Declaration Form CN22, affixed to a blue velvet background, used for providing necessary details when shipping goods internationally.
Background
During the development of AES, a Trade Resource Group was established, comprising representatives from various stakeholders, such as large and small exporters, carriers, freight forwarders, port authorities, and non-vessel operating common carriers (NVOCC). To ensure inclusivity, separate coalitions were formed for exporters and software vendors, accommodating their specific needs and concerns.
To gather input and requirements for AES, position papers were collected from trade associations, and public meetings were held across the country. Feedback and comments from the trade community were collected during these meetings, helping shape AES’s data requirements and automation capabilities. This collaboration with the trade community continued as AES evolved.
The implementation of AES occurred in phases. Phase I, which began in July 1995, involved five vessel ports: Baltimore, Norfolk, Charleston, Houston, and Los Angeles/Long Beach. During this phase, participating companies had to dual report their exports by submitting both paper and electronic versions of the Electronic Export Information. This dual reporting allowed the Census Bureau to evaluate the accuracy and reliability of the electronic data.
After the successful completion of Phase I in June 1996, AES expanded to include all vessel ports on October 1, 1996. The requirement for dual reporting was eliminated at this stage. Subsequently, in July 1997, AES expanded further to receive air and overland commodity data, as well as all commodity data for vessel shipments from all ports. The ongoing collaboration with the trade community and Interest-Based Negotiations led to enhancements in AES, providing more filing options for exporters and their agents.
How AES Works?
The Automated Export System works as an electronic platform that collects and processes export data from the United States. It facilitates the reporting of export information by exporters and helps ensure compliance with U.S. export regulations. Here’s how AES typically works:
Data Filing by Exporters
Exporters, or their authorized agents (such as freight forwarders), are responsible for filing the required export information through AES. This information includes details about the exporter, consignee, commodity being exported, value of the goods, destination country, and any necessary export licenses or other regulatory information.
Electronic Transmission
AES operates as an electronic system, allowing exporters to submit export information electronically. The data is securely transmitted to the U.S. Customs and Border Protection (CBP) and the U.S. Census Bureau.
Validation and Review
Upon receiving the export data, AES performs validation checks to ensure the accuracy and completeness of the information. If any discrepancies or missing data are identified, the system may trigger alerts or notifications to the filer to address the issues.
Compliance Check
AES verifies whether the exported goods comply with U.S. export laws and regulations. This includes checking for export control restrictions, licensing requirements, and any other relevant trade compliance measures.
Statistical Reporting
One of the primary purposes of AES is to collect export statistics. The data compiled in AES is used to create reports on U.S. export trends, economic indicators, and the country’s Gross Domestic Product. These statistics are valuable for policymakers, businesses, and researchers to analyze and understand international trade patterns.
Record Keeping
AES maintains a record of all export transactions. This data is securely stored and can be accessed by authorized government agencies for regulatory and enforcement purposes.
Trade Compliance and National Security
By collecting accurate export data and enforcing export regulations, AES helps enhance trade compliance and strengthen national security. It enables the U.S. government to monitor exports for potential risks and ensure that sensitive items do not fall into unauthorized hands.
When Is AES Filing Needed?
AES filing is needed when exporting goods from the United States under certain circumstances. The requirement for AES filing is determined by the type of goods being exported, the destination country, the value of the shipment, and other factors. Here are some common situations when AES filing is needed:
Exporting Physical Goods
If you are exporting physical goods from the United States to a foreign country, you may be required to file AES. This applies to both commercial shipments and personal goods being sent abroad.
Export Value Exceeds the Threshold
In general, if the value of your goods exceeds $2,500 per Schedule B (Harmonized System) commodity code, you are required to file AES. However, there are exceptions for certain low-value shipments.
Exporting Items Requiring an Export License
If you are exporting items that require an export license from a U.S. government agency, AES filing is mandatory. Certain items, such as defense articles, controlled technologies, and sensitive dual-use goods, may need specific export licenses.
Exporting to Certain Embargoed or Restricted Countries
When exporting goods to countries under U.S. trade sanctions or embargoes, AES filing is typically required, regardless of the shipment’s value.
Vessel or Aircraft Cargo
For shipments transported by vessel (sea) or aircraft, AES filing is generally mandatory, regardless of the value.
Permanent and Temporary Exports
Both permanent exports (goods leaving the U.S. permanently) and temporary exports (goods leaving temporarily and returning) may require AES filing, depending on the circumstances.
Re-Exports
If you are re-exporting goods that were previously imported into the United States, AES filing may be necessary.
Why is AES Filing Mandatory?
Before April 2016, exporters had the option to manually file their export shipment information using a paper form called the Shipper’s Export Declaration (SED). However, since April 2016, exporters are now required to submit shipment information electronically through a system known as AESDirect, which is accessible through the Automated Commercial Environment (ACE).
The electronic export information provided by exporters is referred to as Electronic Export Information (EEI). This mandatory filing is implemented to serve several important purposes. Firstly, it helps the U.S. government monitor and control the export of critical goods and technologies that could potentially pose a threat to the country’s national security. Additionally, AES filing significantly improves the accuracy and timeliness of export statistics, providing valuable insights for policymakers, businesses, researchers, and economists.
AES filing is mandatory for U.S. exporters in the following scenarios:
- When the export merchandise is valued at $2,500 or more based on the Schedule B number from the U.S.
- If an export shipment contains multiple items with the same Schedule B number, and their combined value totals $2,500 or more, AES filing is required. For instance, if two items in the shipment have the same Schedule B number, each valued at $1,500, making a total of $3,000.
- For all exports that require an Export License from the U.S. Commerce or State Departments, regardless of their value.
- When exporting merchandise subject to ITAR (International Traffic in Arms Regulations) but exempt from licensing requirements, regardless of its value or destination.
- For all used self-propelled vehicles, regardless of their value or export destination.
- In the case of rough diamonds classified under HS (Harmonized System) subheadings 7102.10, 7102.21, and 7102.31, AES filing is mandatory, irrespective of their value or destination.
It’s important to note that AES filing must generally be completed within 1 to 24 hours before the actual export of the shipment, depending on the method of transportation. Ensuring compliance with these AES filing requirements is crucial to meet U.S. export regulations and avoid potential penalties or delays in the export process.
Penalties for Failing to File AES
Failure to file export information through AES or providing inaccurate information can lead to civil and criminal penalties. The penalties for non-compliance or filing incorrect information can be substantial, with a maximum of up to $10,000 per violation.
The Office of Export Enforcement, under the U.S. Department of Commerce, and U.S. Customs and Border Protection (CBP), a part of the Department of Homeland Security (DHS), are the agencies responsible for investigating and enforcing export regulations. These agencies work to ensure compliance with export laws, prevent illegal exports of sensitive items, and safeguard national security interests.
They have the authority to conduct audits, investigations, and inspections to ensure that exporters adhere to AES filing requirements and other relevant export regulations. Penalties may be imposed on individuals or businesses found to be in violation of the rules and regulations governing exports from the United States.
Who Does the AES Filing?
AES filing is a standard requirement for export transactions originating from the United States. The filing is usually completed by the US Principal Party in Interest (USPPI), who is the primary party responsible for the export. However, an authorized agent, such as a freight forwarder, can also submit the AES filing on behalf of the USPPI.
In some cases, when the Foreign Principal Party in Interest (FPPI), often the final consignee, hires a US-based freight forwarder to arrange the export, the FPPI’s US agent can also handle the AES filing. It’s essential that the address provided for the USPPI in the AES filing represents the location from where the goods will depart for the designated port of export.
If the US exporter or the foreign buyer chooses to delegate the AES filing responsibility to an agent or freight forwarder, they must provide a written limited power of attorney or another approved form of written authorization to that agent.
While the actual AES filing task can be outsourced, the ultimate responsibility for the accuracy and compliance of the filing remains with the US exporter or the foreign buyer. They cannot transfer the liability associated with AES filing to their appointed agent or third-party service provider.
How To File with AES?
To file with AES using AESDirect, follow these steps:
- Create or log in to your ACE exporter account or the ACE secure data portal.
- Access the AESDirect page through the CBP website or Total Connections.
- On the AESDirect page, click on the “Accounts” tab at the top.
- From the drop-down menu, select the “Exporter” option next to the “View” tab.
- Click on the “Submit AESDirect Filings” option.
- You will see sections for Shipment, Parties, Commodities, and Transportation. Fill in all the relevant information accurately for each section.
- Review the information you provided to ensure its correctness.
- When you are confident that all the information is accurate, click on “Submit Filing.”
- AESDirect will process the submission and provide a message indicating either successful validation or errors in the filing.
- If the submission is successfully validated, you will receive an Internal Transaction Number (ITN) as confirmation. If there are errors, you must correct them before re-submitting the filing.
Make sure to carefully review all the details before submitting the AES filing to avoid errors or discrepancies. Accurate and timely filing through AESDirect helps ensure compliance with U.S. export regulations and facilitates smooth international trade operations.
Benefits of AES Filing
Guaranteeing Compliance: AES’s automated nature simplifies the process of filling in export information and instantly checks for errors, ensuring compliance with relevant export laws and requirements. Businesses receive their Internal Transaction Number (ITN) immediately, and any mistakes in the filing process are promptly identified.
Cost Effectiveness
Compared to earlier paper-based methods of filing, AES significantly reduces costs and inefficiencies. Expenses related to edits, handling, and duplicate records are minimized. The automated system allows for convenient and efficient storage of larger volumes of information, eliminating the need for repetitive input of documents for a single transaction, resulting in significant cost savings.
Efficiency
AES filing streamlines various export processes. It involves collaboration between different commercial and state bodies, such as the Bureau of Industry and Security (BIS) and the Directorate of Defense Trade Controls, leading to quicker and more accurate processing and validation of Electronic Export Information (EEI). The electronic nature of AES facilitates seamless operations in different countries, enhancing overall efficiency.
Accuracy and Timeliness
AES filing reduces the likelihood of errors in export information. The automated system ensures that data is consistently and accurately reported, reducing the risk of mistakes associated with manual processes. The prompt validation and ITN issuance result in faster and more reliable export transactions.
Safeguarding National Security
AES filing helps monitor and regulate the export of sensitive goods and technologies, contributing to national security efforts. By collecting detailed export data, the system enables authorities to identify and prevent unauthorized transfers of critical items.
Data Management and Reporting
The electronic nature of AES allows for efficient data management and reporting. Export statistics are compiled accurately and in a timely manner, providing valuable insights for policymakers, businesses, and researchers to analyze trade trends and economic indicators.
Integration with Other Systems
AES is a part of the Automated Commercial Environment (ACE), a comprehensive platform that links various government agencies and trade partners. This integration streamlines communication and data exchange, enhancing collaboration and information sharing across the entire industry.
Final Thoughts
Automated Export System filing has revolutionized the export landscape, offering numerous advantages to the maritime industry and beyond. Its automated nature ensures compliance with export laws by detecting errors promptly, guaranteeing smooth and lawful transactions.
AES has significantly cut costs and enhanced efficiency through streamlined processes and improved data management. Its seamless integration with other systems facilitates international operations, making it a preferred choice for exporters, logistics providers, and port workers.
Moreover, AES plays a crucial role in safeguarding national security by monitoring critical goods and technologies. AES filing stands as an indispensable tool, fostering secure, efficient, and compliant global trade practices.
I’m Tammy Waller, a supply chain and logistics specialist with over 10 years of expertise. I’ve been an author and SFL employee for over 10 years.
As an author, I’ve been able to teach others. I love guiding users through supply chain and logistics operations.
I have substantial experience managing logistics operations, supply chain management, transportation, inventory management, and warehousing in shipping-moving and logistic services. I’ve worked on many worldwide logistics and supply chain projects, honing my abilities in negotiating rates, scheduling shipments, and managing vendors.
