1. 1June 5, 2002eCP Organization ACE Deployment Panel Trade Support Network June 5, 2002 Rod MacDonald, U.S. Customs Service

2. 2June 5, 2002eCP Organization Agenda Review the overall deployment of ACE Provide specific detail on Increment 1 –Release 1: Account Portal Timeline –Release 2: ACE release for trucks and periodic payment Provide the current Plan for Increments 2 through 4

3. 3June 5, 2002eCP Organization Today’s goal Provide the TSN members with an understanding of: The current status of the ACE project The trade’s role in the design process The planned ACE deployment

4. 4June 5, 2002eCP Organization ACE Deployment Overview Trade Support Network June 5, 2002 Sam Banks, eCP

5. 5June 5, 2002eCP Organization Modernization Act Enables Transformation - Authority to Change - Permitted to Integrate - Quid pro Quo with Trade - Improve Automation Change Agents ACE Enabler Agent -Entry by Entry -Port Specific -Transaction Oriented / No Aggregated Information -Stove-Piped Systems -Delayed Analysis -No Integrated Law Enforcement -No Integrated PGA Information -Data Focus -Paper Intensive -Information at Time of Arrival or After -Experts at Each Port -Difficult, Cumbersome and Error Prone -Entry by Entry -Port Specific -Transaction Oriented / No Aggregated Information -Stove-Piped Systems -Delayed Analysis -No Integrated Law Enforcement -No Integrated PGA Information -Data Focus -Paper Intensive -Information at Time of Arrival or After -Experts at Each Port -Difficult, Cumbersome and Error Prone Trade Growth Threat Growth -Account Based Processing -National Accounts -Account Aggregation -Customs-Wide Shared Information -Timely Analysis -Infrastructure for Integrated Information, Trade, Enforcement and Organization Change -Integration with PGAs -Intelligence Focus -Improved Operational Effectiveness -Pre-Arrival Information -Leverage Distributed Expertise -“Point and Click” -Account Based Processing -National Accounts -Account Aggregation -Customs-Wide Shared Information -Timely Analysis -Infrastructure for Integrated Information, Trade, Enforcement and Organization Change -Integration with PGAs -Intelligence Focus -Improved Operational Effectiveness -Pre-Arrival Information -Leverage Distributed Expertise -“Point and Click” 199319992000200120022003+1989 ModernizationActModernizationAct Transformation

6. 6June 5, 2002eCP Organization Guidelines for Sequencing Sequence of ACE functionality is for planning purposes only –Priorities and funding will impact the sequence Major business processes may be spread across two or more Releases –Transparent to Trade ACS and other legacy systems will be subsumed into ACE ACE capabilities will be initially tested on limited sets of companies at limited sites –Selection criteria will be provided by Customs through published Federal Register notices

7. 7June 5, 2002eCP Organization Factors that Impact Sequencing Precedence –The ACE Infrastructure must be in place before ACE functionality can be provided –Dependent functions must follow precedent functions –Example: Periodic payments depend on account structure Customs / Trade Prioritization –Example: Homeland Security implications Expenditure Projections –Balance functionality with expected funding profile Resource Balancing –ACE schedule requires concurrent development activities

8. 8June 5, 2002eCP Organization Release 1 – 1.1 Release 1 – 4.1 Release 2 – 1.2 Release 1 – 2.1 Increment 1 8/01 – 10/04* Full Conveyance Tracking Full Cargo Tracking Full Account Revenue Functions Full Risk Management Release 2 – 2.2 Increment 2 2/02 – 1/05 Increment 3 11/02 – 8/05 Increment 4 8/03 – 9/05 Consolidated Interface for Inspectors Automated Truck Manifest e-Release for Trucks Enhanced Account Management Initial Account Revenue Risk Management: Record inspection findings and perform analysis Accounts for all Trade types (except Exporters) Enhanced Account Management: Hierarchies Enhanced Account Revenue Bond Management: eBond & Bond Query Remaining Truck Release Processes Initiate IPR Database Enhanced Risk Mgmt: Targeting & Selectivity DB, and Lab findings Integrated Manifest for all modes of Transportation e-Release (and Standard Release) for all modes Integrated process for Import Transactions Initial Cargo Tracking (In-Bond, FTZ & Warehouse) Initial Conveyance Tracking License, Permit, Certification Database Enhanced Account Revenue Enhanced Risk Mgmt: Initial Compliance Assessment Automated Entry Summary (including Importer Activity Summary Statement, and Reconciliation) Automated Liquidation Automated Protest Management Enhanced Account Revenue Enhanced Risk Mgmt: Electronic Team Review Findings Trade Statistics & Reports Account Management: Exporters Full Export Processing Multi-modal Manifest Automated Mail Release Automated Drawback Release 1 – 3.1 Automated Quota & Visa Mgmt Automated AD/CVD Bond Sufficiency Enhanced Customs Reference Information Full IPR Capability Release 2 – 3.2 Summary of ACE Increments and Releases Key Requirements Complete; TO4 Under Contract Requirements Complete; Subject to Negotiation Requirements Under Development Baseline Program Plan ACE Infrastructure Secure Web Portal Account-based access for USCS & 40 Importers Initial Account Database ACE Reference Files (HTS) Source: Increment Allocation Matrix V.2.2. April 18, 2002; *Task Order 4 Contract

9. 9June 5, 2002eCP Organization ACE Development Timeline

10. 10June 5, 2002eCP Organization Increment 1, Release 1 – 1.1 ACE Infrastructure Secure Web Portal Account-based access for USCS & 40 Importers Initial Account Database ACE Reference Files (HTS) Oct 2002 – May 2003 Deployment Increment 1, Release 1 KEY BENEFITS The IT Infrastructure and Web Portal capabilities that are delivered in October, provide the foundation upon which the rest of ACE as well as other modernization systems will be built. In February, ACE will offer the 40 import accounts and their Account Managers a comprehensive view of account and financial transaction data. This allows the Accounts and select trading partners to manage issues and resolve problems more effectively KEY BENEFITS The IT Infrastructure and Web Portal capabilities that are delivered in October, provide the foundation upon which the rest of ACE as well as other modernization systems will be built. In February, ACE will offer the 40 import accounts and their Account Managers a comprehensive view of account and financial transaction data. This allows the Accounts and select trading partners to manage issues and resolve problems more effectively KEY IMPACTS The first forty selected accounts will be established. OIT will have access to the October release for Pilot Test. Customs Account Managers and their counterparts in the trade will have initial Account functionality in February. A subset of total business requirements will be enabled, allowing the Trade reports and queries of account financial and transaction data. KEY IMPACTS The first forty selected accounts will be established. OIT will have access to the October release for Pilot Test. Customs Account Managers and their counterparts in the trade will have initial Account functionality in February. A subset of total business requirements will be enabled, allowing the Trade reports and queries of account financial and transaction data. October 2002 – ACE Portal Framework System Infrastructure Ready for Testing February 2003 – Initial Account Management Capabilities October 2002 – ACE Portal Framework System Infrastructure Ready for Testing February 2003 – Initial Account Management Capabilities HIGHLIGHTS

11. 11June 5, 2002eCP Organization Aug 2003 – Oct 2004 Deployment Increment 1, Release 2 KEY BENEFITS Improves processing at land border crossing through e-Release for Trucks for Customs approved accounts. In addition, standard release for Trucks and other existing release mechanisms will be available through a single sign on interface. Pre-filing by the Trade and pre-arrival analysis by Customs will enable Customs to move shipments more quickly. Periodic payments may result in fewer check processing transactions for Customs and the Trade. KEY BENEFITS Improves processing at land border crossing through e-Release for Trucks for Customs approved accounts. In addition, standard release for Trucks and other existing release mechanisms will be available through a single sign on interface. Pre-filing by the Trade and pre-arrival analysis by Customs will enable Customs to move shipments more quickly. Periodic payments may result in fewer check processing transactions for Customs and the Trade. KEY IMPACTS Consolidated interface for Inspectors, provides a single sign on to 7 different inspector systems. Pre-arrival processing of the automated truck manifest and entry allows Customs to make more informed decisions at the time of arrival. Capabilities will be expanded to 1100 additional Importer accounts, and include additional account management functionality such as automated, periodic statements and payments. KEY IMPACTS Consolidated interface for Inspectors, provides a single sign on to 7 different inspector systems. Pre-arrival processing of the automated truck manifest and entry allows Customs to make more informed decisions at the time of arrival. Capabilities will be expanded to 1100 additional Importer accounts, and include additional account management functionality such as automated, periodic statements and payments. August 2003 – Enhanced Account Management Functions Periodic Statement & Payment Processing December 2003 – Improved Processing for Land Border Crossing August 2003 – Enhanced Account Management Functions Periodic Statement & Payment Processing December 2003 – Improved Processing for Land Border Crossing Increment 1, Release 2 – 1.2 Consolidated Interface for Inspectors Automated Truck Manifest e-Release for Trucks Enhanced Account Management Initial Account Revenue Risk Management: Record inspection findings and perform analysis HIGHLIGHTS

12. 12June 5, 2002eCP Organization Nov 2003 – Mar 2004 Deployment Increment 2, Release 1 KEY BENEFITS Promotes informed compliance and improves problem resolution through Interactive communication among all types of Trade account types. Electronic payment option reduces paperwork by allowing participants to pay fees, duties and taxes electronically. KEY BENEFITS Promotes informed compliance and improves problem resolution through Interactive communication among all types of Trade account types. Electronic payment option reduces paperwork by allowing participants to pay fees, duties and taxes electronically. KEY IMPACTS Account management functionality expands from Importer-only to include all types of Trade accounts – Brokers, Carriers, and Sureties. All of these Accounts share a common interface to communicate with Customs. Expanded participation offers the Trade increased transparency into the government processes of the supply chain. KEY IMPACTS Account management functionality expands from Importer-only to include all types of Trade accounts – Brokers, Carriers, and Sureties. All of these Accounts share a common interface to communicate with Customs. Expanded participation offers the Trade increased transparency into the government processes of the supply chain. Expand Account Management to Other Types of Accounts Bond Management Enhanced Risk Management Expand Account Management to Other Types of Accounts Bond Management Enhanced Risk Management Increment 2, Release 1 – 2.1 Accounts for all Trade types (except Exporters) Enhanced Account Management: Hierarchies Enhanced Account Revenue Bond Management: eBond & Bond Query Remaining Truck Release Processes Initiate IPR Database Enhanced Risk Mgmt: Targeting & Selectivity DB, and Lab findings HIGHLIGHTS

13. 13June 5, 2002eCP Organization Sept 2004 – Jan 2005 Deployment Increment 2, Release 2 KEY BENEFITS Single, integrated manifest that supports all modes of transport streamlines processes and gives Customs a view of all modes. Permits filing to be completed anytime, anywhere. Improves security, by enabling Customs Inspectors to track the movement of cargo while under the legal custody of Customs, including periods of temporary storage. KEY BENEFITS Single, integrated manifest that supports all modes of transport streamlines processes and gives Customs a view of all modes. Permits filing to be completed anytime, anywhere. Improves security, by enabling Customs Inspectors to track the movement of cargo while under the legal custody of Customs, including periods of temporary storage. KEY IMPACTS The Trade will see standardized processing for all modes of Transportation (Air, Rail, Truck and Sea) through an integrated manifest and e-release. KEY IMPACTS The Trade will see standardized processing for all modes of Transportation (Air, Rail, Truck and Sea) through an integrated manifest and e-release. Integrated Manifest for all Modes of Transportation E-Release and Standard Release for All Modes Cargo and Conveyance Tracking Integrated Manifest for all Modes of Transportation E-Release and Standard Release for All Modes Cargo and Conveyance Tracking Increment 2, Release 2 – 2.2 Integrated Manifest for all modes of Transportation e-Release (and Standard Release) for all modes Integrated process for Import Transactions Initial Cargo Tracking (In-Bond, FTZ & Warehouse) Initial Conveyance Tracking License, Permit, Certification Database Enhanced Account Revenue Enhanced Risk Mgmt: Initial Compliance Assessment HIGHLIGHTS

14. 14June 5, 2002eCP Organization Automated Quotas & Visas Intellectual Property Rights Anti-Dumping /Countervailing Duty Improvements Automated Quotas & Visas Intellectual Property Rights Anti-Dumping /Countervailing Duty Improvements Feb 2005 – Jun 2005 Deployment Increment 3, Release 1 Increment 3, Release 1 – 3.1 Automated Quota & Visa Mgmt Automated AD/CVD Bond Sufficiency Enhanced Customs Reference Information Full IPR Capability HIGHLIGHTS KEY BENEFITS KEY IMPACTS Automated update and status of quotas and management of visas will streamline operations and maintain tighter control of quota limits Increase IPR compliance rates and improve Customs ability to protect Trade intellectual assets. Streamline AD/CVD processes and improve coordination with the Dept of Commerce. Trade is able to better manage imports with quota restrictions. Customs Import Specialists will be responsible for improving coordination of AD/CVD decisions from Dept of Commerce. Inspectors and Import Specialist will be able to make better decisions on IPR, with additional upfront information. Trade will have additional, more timely visibility into IPR data.

15. 15June 5, 2002eCP Organization Automated Entry Summary /Importer Activity Summary Statement (IASS) Trade Statistics and Reporting Liquidation and Protest Management Automated Entry Summary /Importer Activity Summary Statement (IASS) Trade Statistics and Reporting Liquidation and Protest Management May 2005 – Aug 2005 Deployment Increment 3, Release 2 Automated Entry Summary (including Importer Activity Summary Statement, and Reconciliation) Automated Liquidation Automated Protest Management Enhanced Account Revenue Enhanced Risk Mgmt: Electronic Team Review Findings Trade Statistics & Reports Increment 3, Release 2 – 3.2 HIGHLIGHTS KEY BENEFITS KEY BENEFITS KEY IMPACTS Importer Activity Summary Statement (IASS) reduces reporting burden on Trade. Improved trade statistics will provide better visibility into international trade. Automated liquidation and protest management will streamline business processes and improve efficiencies. Automated liquidation and protest management will reduce burden on Customs Import Specialists and team reviews.

16. 16June 5, 2002eCP Organization Jul 2005 – Sep 2005 Deployment Increment 4 Increment 4, Release 1 – 4.1 Full Conveyance Tracking Full Cargo Tracking Full Account Revenue Functions Full Risk Management Account Management: Exporters Full Export Processing Multi-modal Manifest Automated Mail Release Automated Drawback HIGHLIGHTS KEY BENEFITS KEY IMPACTS Full Export Processing Multi-modal Manifest Full Cargo and Conveyance Tracking Full Export Processing Multi-modal Manifest Full Cargo and Conveyance Tracking HIGHLIGHTS Multi-modal manifest simplifies reporting and tracking of imports. Better management and control of Foreign Trade Zone, warehouse, and in-bond activity. Trade is provided full visibility of all import and export transactions. Improved visibility to Trade and Customs of in-bond, Foreign Trade Zone, and warehouse activity. Exporters are provided full transaction capabilities through ACE.

17. Comments / Questions 17