The Reconciliation Process in U.S. Customs: Practical Applications and Key Procedures

The Reconciliation Process in U.S. Customs: Practical Applications and Key Procedures 612 408 Transmodal

In the complex arena of international trade, the Reconciliation process under the U.S. Customs and Border Protection (CBP) stands out as a vital tool for importers. Originating from the Customs Modernization Act (Mod Act) of 1993, this process has adapted to the evolving needs of global trade, particularly with its transition to the Automated Commercial Environment (ACE).

**Evolution and Significance of Reconciliation**

The Reconciliation process began as the ACS Reconciliation Prototype Test in 1998, transitioning to the ACE platform in 2018. This was in response to the Mod Act’s amendments, which established new provisions for Reconciliation under various U.S. Code sections.

**Reconciliation in Action: Real-World Examples**

Reconciliation is crucial for items where certain information is not definitively known at the time of import. Here are some real-world examples:

1. **Electronics with Variable Pricing:** Consider a shipment of smartphones where the final sale price is subject to post-importation discounts based on market conditions. Reconciliation allows for the adjustment of the value of these goods after importation.

2. **Apparel Subject to Changing Classifications:** Clothing items that might fall under different tariff classifications based on their material composition or use, which could be pending legal interpretation or rulings.

3. **Automotive Parts Eligible for FTA Benefits:** Car parts imported for assembly in the U.S. might qualify for NAFTA (now USMCA) benefits, but their eligibility is determined after importation based on the final product’s compliance with the trade agreement’s rules of origin.

4. **Machinery with 9802 Adjustments:** Heavy machinery imported with components manufactured in the U.S. and assembled abroad. The value of these U.S. components, crucial for duty calculations under HTSUS subheadings 9802.00.60-9802.00.90, is reconciled post-importation.

**Core Aspects of Reconciliation**

The process involves flagging entry summaries and filing a Reconciliation entry, where importers can combine multiple entries. It’s particularly relevant for products with variable pricing, complex classifications, potential FTA eligibility, and 9802 adjustments.

**Eligibility and Procedures**

Eligibility extends to all importers with a valid continuous bond and a Reconciliation bond rider. The flagging of entry summaries indicates the importer’s intent to file a Reconciliation entry later.

**Filing Reconciliation Entries**

Filing requires strict adherence to guidelines and timelines, with the entry electronically transmitted using ABI and filed in ACE. It addresses issues like value, classification, and FTA claims.

**Implications for Importers**

While CBP recommends the Reconciliation program for its efficiency, importers must be aware of potential penalties for non-compliance. Understanding and adhering to these processes is crucial for smooth operations in international trade.


The Reconciliation process is a cornerstone of U.S. customs procedures, offering a structured way to manage indeterminable information at the time of import. For businesses engaged in international trade, staying informed and compliant with these processes is essential for successful operations.