PART 111—CUSTOMS BROKERS Authority: 19 U.S.C. 66, 1202 (General Note 3(i), Harmonized Tariff Schedule of the United States), 1624; 1641. Section 111.2 also issued under 19 U.S.C. 1484, 1498; Section 111.96 also issued under 19 U.S.C. 58c, 31 U.S.C. 9701. Source: T.D. 00-17, 65 FR 13891, Mar. 15, 2000, unless otherwise noted. § 111.0 Scope. This part sets forth regulations providing for the licensing of, and granting of permits to, persons desiring to transact customs business as customs brokers, including the qualifications required of applicants, and the procedures for applying for licenses and permits. This part also prescribes the duties and responsibilities of brokers, the grounds and procedures for disciplining brokers, including the assessment of monetary penalties, the revocation or suspension of licenses and permits, and the obligation for individual brokers to satisfy a continuing education requirement. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 23-04, 88 FR 41258, June 23, 2023] Subpart A—General Provisions § 111.1 Definitions. When used in this part, the following terms have the meanings indicated: Appropriate Executive Director, Office of Trade. Broker. Broker's office of record. Continuing broker education requirement. Continuing education credit. Corporate compliance activity. Customs broker. Customs business. Department of Homeland Security or any representative of the Department of Homeland Security. Employee. Executive Assistant Commissioner. Freight forwarder. Officer. Permit. Person. Processing Center. Qualifying continuing broker education. Records. Responsible supervision and control. See Triennial period. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 03-15, 68 FR 47460, Aug. 11, 2003; CBP Dec. 22-21, 87 FR 63313, Oct. 18, 2022; CBP Dec. 23-04, 88 FR 41258, June 23, 2023] § 111.2 License and permit required. (a) License General. (2) Transactions for which license is not required For one's own account. (ii) As employee of broker General. ( 1 Authorized to sign documents. ( 2 Authorized to transact other business. (B) Broker supervision; withdrawal of authority. (iii) Marine transactions. (iv) Transportation in bond. (v) Noncommercial shipments. (vi) Foreign trade zone activities. (b) National permit. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 03-15, 68 FR 47460, Aug. 11, 2003;CBP Dec. 09-47, 74 FR 69018, Dec. 30, 2009; CBP Dec. 22-21, 87 FR 63313, Oct. 18, 2022] § 111.3 Customs business. (a) Location. (b) Point of contact. [CBP Dec. 22-21, 87 FR 63313, Oct. 18, 2022] § 111.4 Transacting customs business without a license. Any person who intentionally transacts customs business, other than as provided in § 111.2(a)(2), without holding a valid broker's license, will be liable for a monetary penalty for each such transaction as well as for each violation of any other provision of 19 U.S.C. 1641. The penalty will be assessed in accordance with subpart E of this part. § 111.5 Representation before Government agencies. (a) Agencies within the Department of Homeland Security. (b) Agencies not within the Department of Homeland Security. Subpart B—Procedure To Obtain License or Permit § 111.11 Basic requirements for a license. (a) Individual. (1) Be a citizen of the United States on the date of submission of the application referred to in § 111.12(a) and not an officer or employee of the United States Government; (2) Attain the age of 21 prior to the date of submission of the application referred to in § 111.12(a); (3) Be of good moral character; and (4) Have established, by attaining a passing (75 percent or higher) grade on an examination taken within the 3-year period before submission of the application referred to in § 111.12(a), that he has sufficient knowledge of customs and related laws, regulations and procedures, bookkeeping, accounting, and all other appropriate matters to render valuable service to importers and exporters. (b) Partnership. (c) Association or corporation. (1) Be empowered under its articles of association or articles of incorporation to transact customs business as a broker; and (2) Have at least one officer who is a broker. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 17-05, 82 FR 29718, June 30, 2017] § 111.12 Application for license. (a) Submission of application and fee. see (b) Withdrawal of application. [CBP Dec. 22-21, 87 FR 63313, Oct. 18, 2022] § 111.13 Examination for individual license. (a) Scope of examination. (b) Basic requirements, date, and place of examination. Federal Register (c) Special examination. (d) Failure to appear for examination. (e) Notice of examination result. (f) Appeal of failing grade on examination. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by T.D. 03-23, 68 FR 31977, May 29, 2003, CBP Dec. 09-38, 74 FR 52401, Oct. 13, 2009; CBP Dec. 10-29, 75 FR 52458, Aug. 26, 2010; CBP Dec. 17-05, 82 FR 29718, June 30, 2017; CBP Dec. 22-21, 87 FR 63314, Oct. 18, 2022] § 111.14 Background investigation of the license applicant. (a) Scope of background investigation. (1) The accuracy of the statements made in the application and interview; (2) The business integrity and financial responsibility of the applicant; and (3) When the applicant is an individual (including a member of a partnership or an officer of an association or corporation), the character and reputation of the applicant, including any association with any individuals or groups that may present a risk to the security or to the revenue collection of the United States. (b) Referral to Headquarters. (c) Additional inquiry. [CBP Dec. 22-21, 87 FR 63314, Oct. 18, 2022] § 111.15 Issuance of license. If the appropriate Executive Director, Office of Trade, finds that the applicant is qualified and has paid all applicable fees prescribed in § 111.96(a), the Executive Assistant Commissioner will issue a license. A license for an individual who is a member of a partnership, or an officer of an association or corporation will be issued in the name of the individual licensee and not in his or her capacity as a member or officer of the organization with which he or she is connected. The license will be forwarded to the processing Center, which will deliver it to the licensee. [CBP Dec. 22-21, 87 FR 63314, Oct. 18, 2022] § 111.16 Denial of a license. (a) Notice of denial. (b) Grounds for denial. (1) Any cause which would justify suspension or revocation of the license of a broker under the provisions of § 111.53; (2) The failure to meet any requirement set forth in § 111.11; (3) A failure to establish the business integrity and financial responsibility of the applicant; (4) A failure to establish the good character and reputation of the applicant; (5) Any willful misstatement or omission of pertinent facts in the application or interview for the license; (6) Any conduct which would be deemed unfair or detrimental in commercial transactions by accepted standards; (7) A reputation imputing to the applicant criminal, dishonest, or unethical conduct, or a record of that conduct; or (8) Any other relevant information uncovered over the course of the background investigation. [CBP Dec. 22-21, 87 FR 63314, Oct. 18, 2022] § 111.17 Review of the denial of a license. (a) By the appropriate Executive Director, Office of Trade. (b) By the Executive Assistant Commissioner. (c) By the Court of International Trade. [CBP Dec. 22-21, 87 FR 63314, Oct. 18, 2022] § 111.18 Reapplication for license. An applicant who has been denied a license may reapply at any time by complying with the provisions of § 111.12 and addressing how deficiencies have been remedied. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63315, Oct. 18, 2022] § 111.19 National permit. (a) General. (b) Application for a national permit. (1) The applicant's broker license number and date of issuance if available; (2) If the applicant is applying for a national permit on behalf of a partnership, association, or corporation: the name of the partnership, association, or corporation and the title held by the applicant within the partnership, association, or corporation; (3) If the applicant is applying for a national permit on behalf of a partnership, association, or corporation: a copy of the documentation issued by a State, or local government that establishes the legal status and reserves the business name of the partnership, association, or corporation; (4) The address, telephone number, and email address of the office designated by the applicant as the office of record as defined in § 111.1. The office will be noted in the national permit when issued; (5) The name, telephone number, and email address of the point of contact described in § 111.3(b) to be available to CBP to respond to issues related to the transaction of customs business; (6) If the applicant is applying for a national permit on behalf of a partnership, association, or corporation: the name, broker license number, office address, telephone number, and email address of each individual broker employed by the partnership, association, or corporation; (7) A list of all employees together with the specific employee information prescribed in § 111.28 for each employee; (8) A supervision plan describing how responsible supervision and control will be exercised over the customs business conducted under the national permit, including compliance with § 111.28; (9) The location where records will be retained ( see (10) The name, telephone number, and email address of the knowledgeable employee responsible for broker-wide records maintenance and financial recordkeeping requirements ( see (11) A receipt or other evidence showing that the fees specified in § 111.96(b) and (c) have been paid in accordance with paragraph (b) of this section. (c) Fees. see (d) Action on application; list of permitted brokers. (e) Review of the denial of a national permit By the Executive Assistant Commissioner. (2) By the Court of International Trade. (f) Responsible supervision and control. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-22, 87 FR 63267, Oct. 18, 2022; CBP Dec. 22-21, 87 FR 63315, Oct. 18, 2022; CBP Dec. 23-04, 88 FR 41258, June 23, 2023] Subpart C—Duties and Responsibilities of Customs Brokers § 111.21 Record of transactions. (a) Each broker must keep current in a correct, orderly, and itemized manner records of account reflecting all his financial transactions as a broker. He must keep and maintain on file copies of all his correspondence and other records relating to his customs business. (b) Each broker must provide notification to the CBP Office of Information Technology Security Operations Center (CBP SOC) of any known breach of electronic or physical records relating to the broker's customs business. Notification must be electronically provided ( [email protected] see (c) Each broker must comply with the provisions of this part and part 163 of this chapter when maintaining records that reflect on his transactions as a broker. (d) Each broker must designate a knowledgeable employee as the party responsible for brokerage-wide recordkeeping requirements. Each broker must maintain accurate and current point of contact information in a CBP-authorized electronic data interchange (EDI) system. If a CBP-authorized EDI system is not available, then the information must be provided in writing to the processing Center. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63315, Oct. 18, 2022] § 111.22 [Reserved] § 111.23 Retention of records. (a) Place of retention. (b) Period of retention. [CBP Dec. 12-12, 77 FR 33966, June 8, 2012, as amended by CBP Dec. 22-21, 87 FR 63316, Oct. 18, 2022] § 111.24 Records confidential. The records referred to in this part and pertaining to the business of the clients serviced by the broker are to be considered confidential, and the broker must not disclose their contents or any information connected with the records to any persons other than those clients, their surety on a particular entry, and representatives of the Department of Homeland Security (DHS), or other duly accredited officers or agents of the United States, except on subpoena or court order by a court of competent jurisdiction, or when authorized in writing by the client. This confidentiality provision does not apply to information that properly is available from a source open to the public. [CBP Dec. 22-21, 87 FR 63316, Oct. 18, 2022] § 111.25 Records must be available. (a) General. (b) Examination request. see (c) Recordkeeping requirements. [CBP Dec. 22-21, 87 FR 63316, Oct. 18, 2022] § 111.26 Interference with examination of records. Except in accordance with the provisions of part 163 of this chapter, a broker must not refuse access to, conceal, remove, or destroy the whole or any part of any record relating to his transactions as a broker which is being sought, or which the broker has reasonable grounds to believe may be sought, by the Department of Homeland Security or any representative of the Department of Homeland Security, nor may he otherwise interfere, or attempt to interfere, with any proper and lawful efforts to procure or reproduce information contained in those records. § 111.27 Audit or inspection of records. The Field Director, Regulatory Audit, will make any audit or inspection of the records required by this subpart to be kept and maintained by a broker as may be necessary to enable DHS, or other duly accredited officers or agents of the United States, to determine whether or not the broker is complying with the requirements of this part. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63316, Oct. 18, 2022] § 111.28 Responsible supervision and control. (a) General. (1) The training provided to broker employees; (2) The issuance of instructions and guidelines to broker employees; (3) The volume and type of business conducted by the broker; (4) The reject rate for the various customs transactions relative to overall volume; (5) The level of access broker employees have to current editions of CBP regulations, the Harmonized Tariff Schedule of the United States, and CBP issuances; (6) The availability of a sufficient number of individually licensed brokers for necessary consultation with employees of the broker; (7) The frequency of supervisory visits of an individually licensed broker to another office of the broker that does not have an individually licensed broker; (8) The frequency of audits and reviews by an individually licensed broker of the customs transactions handled by employees of the broker; (9) The extent to which the individually licensed broker who qualifies the permit is involved in the operation of the brokerage and communications between CBP and the brokerage; (10) Any circumstances which indicate that an individually licensed broker has a real interest in the operations of a brokerage; (11) The timeliness of processing entries and payment of duty, tax, or other debt or obligation owing to the Government for which the broker is responsible, or for which the broker has received payment from a client; (12) Communications between CBP and the broker, and the broker's responsiveness and action to communications, direction, and notices from CBP; (13) Communications between the broker and its officer(s) or member(s), and the broker's responsiveness and action to communications and direction from its officer(s) or member(s). (b) Employee information Current employees. (2) New employees. (3) Terminated employees. (c) Broker's responsibility. (d) Termination of qualifying member or officer. (e) Change in ownership. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63316, Oct. 18, 2022] § 111.29 Diligence in correspondence and paying monies. (a) Due diligence by broker. (b) Notice to client of method of payment If you are the importer of record, payment to the broker will not relieve you of liability for customs charges (duties, taxes, or other debts owed CBP) in the event the charges are not paid by the broker. Therefore, if you pay by check, customs charges may be paid with a separate check payable to the “U.S. Customs and Border Protection” which will be delivered to CBP by the broker. (2) The written notification set forth in paragraph (b)(1) of this section must be provided by brokers as follows: (i) On, or attached to, any power of attorney provided by the broker to a client for execution on or after September 27, 1982; and (ii) To each active client no later than February 28, 1983, and at least once at any time within each 12-month period after that date. An active client means a client from whom a broker has obtained a power of attorney and for whom the broker has transacted customs business on at least two occasions within the 12-month period preceding notification. § 111.30 Notification of change in address, organization, name, or location of business records; status report; termination of brokerage business. (a) Change of address. (b) Change in organization. (1) The date on which a licensed member or officer ceases to be the qualifying member or officer for purposes of § 111.11(b) or (c)(2), and the name of the licensed member or officer who will succeed as the license qualifier; (2) The date on which a licensed employee ceases to be the national permit qualifier for purposes of § 111.19(a), and the name of the licensed employee who will succeed as the national permit qualifier; and (3) Any change in the Articles of Agreement, Charter, Articles of Association, or Articles of Incorporation relating to the transaction of customs business, or any other change in the legal nature of the organization (for example, conversion of a general partnership to a limited partnership, merger with another organization, divestiture of a part of the organization, or entry into bankruptcy protection). (c) Change in name. (d) Triennial status report General. (2) Individual. (i) If the individual broker is actively engaged in transacting business as a broker, the individual broker must also: (A) State the name under which, and the address at which, the broker's business is conducted if he or she is a sole proprietor, and an email address; (B) State the name and address of his or her employer if he or she is employed by another broker, unless his or her employer is a partnership, association or corporation broker for which he or she is a qualifying member or officer for purposes of § 111.11(b) or (c)(2); (C) State whether or not he or she still meets the applicable requirements of §§ 111.11 and 111.19 and has not engaged in any conduct that could constitute grounds for suspension or revocation under § 111.53; and (D) Report and certify the broker's compliance with the continuing broker education requirement as set forth in § 111.102. (ii) If the individual broker is not actively engaged in transacting business as a broker, the individual broker must also: (A) State the broker's current mailing address and email address; (B) State whether or not he or she still meets the applicable requirements of §§ 111.11 and 111.19 and has not engaged in any conduct that could constitute grounds for suspension or revocation under § 111.53; and (C) Report and certify the broker's compliance with the continuing broker education requirement as set forth in § 111.102. (3) Partnership, association, or corporation see (ii) A partnership, association, or corporation broker must state whether or not the partnership, association, or corporation broker still meets the applicable requirements of §§ 111.11 and 111.19 and has not engaged in any conduct that could constitute grounds for suspension or revocation under § 111.53. (4) Failure to file timely. Federal Register (e) Custody of records. (1) The individual broker, upon the permanent termination of his brokerage business; (2) Each member of a partnership who holds an individual broker's license, upon the permanent termination of a partnership brokerage business; or (3) Each association or corporate officer who holds an individual broker's license, upon the permanent termination of an association or corporate brokerage business. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63317, Oct. 18, 2022; CBP Dec. 23-04, 88 FR 41258, June 23, 2023] § 111.31 Conflict of interest. (a) Former officer or employee of U.S. Government. (b) Relations with former officer or employee of U.S. Government. (c) Importations by broker or employee. § 111.32 False information. A broker must not file or procure or assist in the filing of any claim, or of any document, affidavit, or other papers, known by such broker to be false. In addition, a broker must not give, or solicit or procure the giving of, any information or testimony that the broker knew or should have known was false or misleading in any matter pending before the Department of Homeland Security or to any representative of the Department of Homeland Security. A broker also must document and report to CBP when the broker separates from or cancels representation of a client as a result of determining the client is intentionally attempting to use the broker to defraud the U.S. Government or commit any criminal act against the U.S. Government. The report to CBP must include the client name, date of separation or cancellation, and reason for the separation or cancellation. [CBP Dec. 22-21, 87 FR 63318, Oct. 18, 2022] § 111.33 Government records. A broker must not procure or attempt to procure, directly or indirectly, information from Government records or other Government sources of any kind to which access is not granted by proper authority. § 111.34 Undue influence upon Department of Homeland Security employees. A broker must not influence or attempt to influence the conduct of any representative of the Department of Homeland Security in any matter pending before the Department of Homeland Security or any representative of the Department of Homeland Security by the use of duress or a threat or false accusation, or by the offer of any special inducement or promise of advantage, or by bestowing any gift or favor or other thing of value. § 111.35 Acceptance of fees from attorneys. With respect to customs transactions, a broker must not demand or accept from any attorney (whether directly or indirectly, including, for example, from a client as a part of any arrangement with an attorney) on account of any case litigated in any court of law or on account of any other legal service rendered by an attorney any fee or remuneration in excess of an amount measured by or commensurate with the time, effort and skill expended by the broker in performing his services. § 111.36 Relations with unlicensed persons. (a) Employment by unlicensed person other than importer. (b) Service to others not to benefit unlicensed person. (c) Relations with a freight forwarder. (1) The importer or other party in interest is notified in advance by the forwarder or broker of the name of the broker selected by the forwarder for the handling of his Customs transactions; (2) The broker transmits directly to the importer or other party in interest: (i) A true copy of his brokerage charges if the fees and charges are to be collected by or through the forwarder, unless this requirement is waived in writing by the importer or other party in interest; or (ii) A statement of his brokerage charges and an itemized list of any charges to be collected for the account of the freight forwarder if the fees and charges are to be collected by or through the broker; (3) The broker must execute a customs power of attorney directly with the importer of record or drawback claimant, and not via a freight forwarder or other third party, to transact customs business for that importer of record or drawback claimant. No part of the agreement of compensation between the broker and the forwarder, nor any action taken pursuant to the agreement, can forbid or prevent direct communication between the importer of record, drawback claimant, or other party in interest and the broker; and (4) In making the agreement and in all actions taken pursuant to the agreement, the broker remains subject to all other provisions of this part. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63318, Oct. 18, 2022] § 111.37 Misuse of license or permit. A broker must not allow his license, permit or name to be used by or for any unlicensed person (including a broker whose license or permit is under suspension), other than his own employees authorized to act for him, in the solicitation, promotion or performance of any customs business or transaction. § 111.38 False representation to procure employment. A broker must not knowingly use false or misleading representations to procure employment in any customs matter. In addition, a broker must not represent to a client or prospective client that he can obtain any favors from the Department of Homeland Security or any representative of the Department of Homeland Security. § 111.39 Advice to client. (a) Withheld or false information. (b) Due diligence. (c) Error or omission by client. (d) Illegal plans. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63318, Oct. 18, 2022] § 111.40 Protests. A broker must not act on behalf of any person, or attempt to represent any person, regarding any protest unless he is authorized to do so in accordance with part 174 of this chapter. § 111.41 Endorsement of checks. A broker must not endorse or accept, without authority of his client, any U.S. Government draft, check, or warrant drawn to the order of the client. § 111.42 Relations with person who is notoriously disreputable or whose license is under suspension, canceled “with prejudice,” or revoked. (a) General. (1) Accept employment to effect a customs transaction as associate, correspondent, officer, employee, agent, or subagent from any person who is notoriously disreputable or whose broker license was revoked for any cause or is under suspension or was cancelled “with prejudice;” (2) Assist in the furtherance of any customs business or transactions of any person described in paragraph (a)(1) of this section; (3) Employ, or accept assistance in the furtherance of any customs business or transactions from, any person described in paragraph (a)(1) of this section, without the approval of the Executive Assistant Commissioner, or his or her designee, (see § 111.79); (4) Share fees with any person described in paragraph (a)(1) of this section; or (5) Permit any person described in paragraph (a)(1) of this section to participate, directly or indirectly and whether through ownership or otherwise, in the promotion, control, or direction of the business of the broker. (b) Client exception. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63318, Oct. 18, 2022] §§ 111.43-111.44 [Reserved] § 111.45 Revocation by operation of law. (a) License and permit. (b) Annual broker permit fee. (c) Publication. Federal Register (d) Applicability of other sanctions. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63318, Oct. 18, 2022] Subpart D—Cancellation, Suspension, or Revocation of License or Permit, and Monetary Penalty in Lieu of Suspension or Revocation § 111.50 General. This subpart sets forth provisions relating to cancellation, suspension, or revocation of a license or a permit, or assessment of a monetary penalty in lieu of suspension or revocation, under section 641(d)(2)(B), Tariff Act of 1930, as amended (19 U.S.C. 1641(d)(2)(B)). The provisions relating to assessment of a monetary penalty under sections 641(b)(6) and (d)(2)(A), Tariff Act of 1930, as amended (19 U.S.C. 1641(b)(6) and (d)(2)(A)), are set forth in subpart E of this part. § 111.51 Cancellation of license or permit. (a) Without prejudice. (b) With prejudice. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.52 Voluntary suspension of license or permit. The appropriate Executive Director, Office of Trade, may accept a broker's written voluntary offer of suspension of the broker's license or permit for a specific period of time under any terms and conditions to which the parties may agree. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.53 Grounds for suspension or revocation of license or permit. The appropriate CBP officer may initiate proceedings for the suspension, for a specific period of time, or revocation of the license or permit of any broker for any of the following reasons: (a) The broker has made or caused to be made in any application for any license or permit under this part, or report filed with CBP, any statement which was, at the time and in light of the circumstances under which it was made, false or misleading with respect to any material fact, or has omitted to state in any application or report any material fact which was required; (b) The broker has been convicted, at any time after the filing of an application for a license under § 111.12, of any felony or misdemeanor which: (1) Involved the importation or exportation of merchandise; (2) Arose out of the conduct of customs business; or (3) Involved larceny, theft, robbery, extortion, forgery, counterfeiting, fraudulent concealment, embezzlement, fraudulent conversion, or misappropriation of funds; (c) The broker has violated any provision of any law enforced by CBP or the rules or regulations issued under any provision of any law enforced by CBP; (d) The broker has counseled, commanded, induced, procured, or knowingly aided or abetted the violations by any other person of any provision of any law enforced by CBP or the rules or regulations issued under any provision of any law enforced by CBP; (e) The broker has knowingly employed, or continues to employ, any person who has been convicted of a felony, without written approval of that employment from the appropriate Executive Director, Office of Trade,; (f) The broker has, in the course of customs business, with intent to defraud, in any manner willfully and knowingly deceived, misled or threatened any client or prospective client; (g) The broker has been convicted of committing or conspiring to commit an act of terrorism as described in section 2332b of title 18, United States Code; or (h) The broker no longer meets the applicable requirements of §§ 111.11 and 111.19. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.54 [Reserved] § 111.55 Investigation of complaints. Every complaint or charge against a broker which may be the basis for disciplinary action may be forwarded for investigation to the appropriate investigative authority within the Department of Homeland Security. The investigative authority will submit a final report on the investigation of complaints to the processing Center and send a copy of the report to the appropriate Executive Director, Office of Trade. [CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.56 Review of report on the investigation of complaints. The processing Center will review the report on the investigation of complaints, or if there is no report on the investigation of complaints, other documentary evidence, to determine if there is sufficient basis to recommend that charges be preferred against the broker. The processing Center will then submit the recommendation with supporting reasons to the appropriate Executive Director, Office of Trade, for final determination together with a proposed statement of charges when recommending that charges be preferred. [CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.57 Determination by appropriate Executive Director, Office of Trade. The appropriate Executive Director, Office of Trade, will make a determination on whether or not charges should be preferred, and will notify the processing Center of the decision. [CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.58 Content of statement of charges. Any statement of charges referred to in this subpart must give a plain and concise, but not necessarily detailed, description of the facts claimed to constitute grounds for suspension or revocation of the license or permit. The statement of charges also must specify the sanction being proposed (that is, suspension of the license or permit or revocation of the license or permit), but if a suspension is proposed the charges need not state a specific period of time for which suspension is proposed. A statement of charges which fairly informs the broker of the charges against him so that he is able to prepare his response will be deemed sufficient. Different means by which a purpose might have been accomplished, or different intents with which acts might have been done, so as to constitute grounds for suspension or revocation of the license may be alleged in the alternative under a single count in the statement of charges. § 111.59 Preliminary proceedings. (a) Opportunity to participate. (b) Notice of preliminary proceedings. (1) Transmits a copy of the proposed statement of charges; (2) Informs the broker that formal proceedings are available to him; (3) Informs the broker that sections 554 and 558, Title 5, United States Code, will be applicable if formal proceedings are necessary; (4) Invites the broker to show cause why formal proceedings should not be instituted; (5) Informs the broker that he may make submissions and demonstrations of the character contemplated by the cited statutory provisions; (6) Invites any negotiation for settlement of the complaint or charge that the broker deems it desirable to enter into; (7) Advises the broker of his right to be represented by counsel; (8) Specifies the place where the broker may respond in writing; and (9) Advises the broker that the response must be received within 30 calendar days of the date of the notice. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.60 Request for additional information. If, in order to prepare his response, the broker desires additional information as to the time and place of the alleged misconduct, or the means by which it was committed, or any other more specific information concerning the alleged misconduct, he may request that information in writing. The broker's request must set forth in what respect the proposed statement of charges leaves him in doubt and must describe the particular language of the proposed statement of charges as to which additional information is needed. If in the opinion of the processing Center that information is reasonably necessary to enable the broker to prepare his response, he will furnish the broker with that information. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.61 Decision on preliminary proceedings. The processing Center will prepare a summary of any oral presentations made by the broker or the broker's attorney and forward it to the appropriate Executive Director, Office of Trade, together with a copy of each paper filed by the broker. The processing Center will also give to the appropriate Executive Director, Office of Trade, a recommendation on action to be taken as a result of the preliminary proceedings. If the appropriate Executive Director, Office of Trade, determines that the broker has satisfactorily responded to the proposed charges and that further proceedings are not warranted, he or she will so inform the processing Center, who will notify the broker. If no response is filed by the broker or if the appropriate Executive Director, Office of Trade, determines that the broker has not satisfactorily responded to all of the proposed charges, he or she will advise the processing Center of that fact and instruct the processing Center to prepare, sign, and serve a notice of charges and the statement of charges. If one or more of the charges in the proposed statement of charges was satisfactorily answered by the broker in the preliminary proceedings, the appropriate Executive Director, Office of Trade, will instruct the processing Center to omit those charges from the statement of charges. [CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.62 Contents of notice of charges. The notice of charges must inform the broker that: (a) Sections 554 and 558, Title 5, United States Code, are applicable to the formal proceedings; (b) The broker may be represented by counsel; (c) The broker will have the right to cross-examine witnesses; (d) The broker will be notified of the time and place of a hearing on the charges; and (e) Prior to the hearing on the charges, the broker may file with the processing Center, a verified answer to the charges. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63319, Oct. 18, 2022] § 111.63 Service of notice and statement of charges. (a) Individual. (1) By delivery to the broker personally; (2) By certified mail, return receipt requested, addressed to the broker's office of record (or other address as provided pursuant to § 111.30). (3) By any other means which the broker may have authorized in a written communication to the processing Center; or (4) If attempts to serve the broker by the methods prescribed in paragraphs (a)(1) through (a)(3) of this section are unsuccessful, the processing Center may serve the notice and statement by leaving them with the person in charge of the broker's office. (b) Partnership, association or corporation. (1) By delivery to any member of the partnership personally or to any officer of the association or corporation personally; (2) By certified mail addressed to any member of the partnership or to any officer of the association or corporation, with demand for a return card signed solely by the addressee; (3) By any other means which the broker may have authorized in a written communication to the processing Center; or (4) If attempts to serve the broker by the methods prescribed in paragraphs (b)(1) through (b)(3) of this section are unsuccessful, the processing Center may serve the notice and statement by leaving them with the person in charge of the broker's office. (c) Certified mail; evidence of service. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.64 Service of notice of hearing and other papers. (a) Notice of hearing. (b) Other papers. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.65 Extension of time for hearing. If the broker or his attorney requests in writing a delay in the hearing for good cause, the hearing officer designated pursuant to § 111.67(a) may reschedule the hearing and in that case will notify the broker or his attorney in writing of the extension and the new time for the hearing. § 111.66 Failure to appear. If the broker or his attorney fails to appear for a scheduled hearing, the hearing officer designated pursuant to § 111.67(a) will proceed with the hearing as scheduled and will hear evidence submitted by the parties. The provisions of this part will apply as though the broker were present, and the Executive Assistant Commissioner may issue an order of suspension of the license or permit for a specified period of time or revocation of the license or permit, or assessment of a monetary penalty in lieu of suspension or revocation, in accordance with § 111.74 if he finds that action to be in order. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.67 Hearing. (a) Hearing officer. (b) Rights of the broker. (c) Interrogatories. (d) Transcript of record. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.68 Proposed findings and conclusions. The hearing officer will allow the parties a reasonable period of time after delivery of the transcript of record in which to submit proposed findings and conclusions and supporting reasons for the findings as contemplated by 5 U.S.C. 557(c). § 111.69 Recommended decision by hearing officer. After review of the proposed findings and conclusions submitted by the parties pursuant to § 111.68, the hearing officer will make his recommended decision in the case and certify the entire record to the Executive Assistant Commissioner. The hearing officer's recommended decision must conform to the requirements of 5 U.S.C. 557. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.70 Additional submissions. Upon receipt of the record, the Executive Assistant Commissioner will afford the parties a reasonable opportunity to make any additional submissions that are permitted under 5 U.S.C. 557(c) or otherwise required by the circumstances of the case. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.71 Immaterial mistakes. The Executive Assistant Commissioner will disregard an immaterial misnomer of a third person, an immaterial mistake in the description of any person, thing, or place, or ownership of any property, any other immaterial mistake in the statement of charges, or a failure to prove immaterial allegations in the description of the broker's conduct. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.72 Dismissal subject to new proceedings. If the Executive Assistant Commissioner finds that the evidence produced at the hearing indicates that a proper disposition of the case cannot be made on the basis of the charges preferred, he or she may instruct the processing Center to serve appropriate charges as a basis for new proceedings to be conducted in accordance with the procedures set forth in this subpart. [CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.73 [Reserved] § 111.74 Decision and notice of suspension or revocation or monetary penalty. If the Executive Assistant Commissioner finds that one or more of the charges in the statement of charges is not sufficiently proved, the suspension, revocation, or monetary penalty action may be based on any remaining charges if the facts alleged in the charges are established by the evidence. If the Executive Assistant Commissioner in the exercise of discretion and based solely on the record, issues an order suspending a broker's license or permit for a specified period of time or revoking a broker's license or permit or, except in a case described in § 111.53(b)(3), assessing a monetary penalty in lieu of suspension or revocation, the appropriate Executive Director, Office of Trade, will promptly provide written notification of the order to the broker and, unless an appeal from the order of the Executive Assistant Commissioner is filed by the broker ( see Federal Register. [CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.75 Appeal from the Executive Assistant Commissioner's decision. An appeal from the order of the Executive Assistant Commissioner suspending or revoking a license or permit, or assessing a monetary penalty, may be filed by the broker in the Court of International Trade as provided in section 641(e), Tariff Act of 1930, as amended (19 U.S.C. 1641(e)). The commencement of those proceedings will, unless specifically ordered by the Court, operate as a stay of the Executive Assistant Commissioner's order. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.76 Reopening the case. (a) Grounds for reopening. (b) Procedure. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.77 Notice of vacated or modified order. If, pursuant to § 111.76 or for any other reason, the Executive Assistant Commissioner issues an order vacating or modifying an earlier order under § 111.74 suspending or revoking a broker's license or permit, or assessing a monetary penalty, the appropriate Executive Director, Office of Trade, will notify the broker in writing and will publish a notice of the new order in the Federal Register [CBP Dec. 22-21, 87 FR 63320, Oct. 18, 2022] § 111.78 Reprimands. If a broker fails to observe and fulfill the duties and responsibilities of a broker as set forth in this part but that failure is not sufficiently serious to warrant initiation of suspension or revocation proceedings, Headquarters, or the processing Center with the approval of Headquarters, may serve the broker with a written reprimand. The reprimand, and the facts on which it is based, may be considered in connection with any future disciplinary proceeding that may be instituted against the broker in question. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63321, Oct. 18, 2022] § 111.79 Employment of broker who has lost license. Five years after the revocation or cancellation “with prejudice” of a license, the ex-broker may petition the appropriate Executive Director, Office of Trade for authorization to assist, or accept employment with, a broker. The petition will not be approved unless the appropriate Executive Director, Office of Trade is satisfied that the petitioner has refrained from all activities described in § 111.42 and that the petitioner's conduct has been exemplary during the period of disability. The appropriate Executive Director, Office of Trade will also give consideration to the gravity of the misconduct which gave rise to the petitioner's disability. In any case in which the misconduct led to pecuniary loss to the Government or to any person, the appropriate Executive Director, Office of Trade will also take into account whether the petitioner has made restitution of that loss. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63321, Oct. 18, 2022] § 111.80 [Reserved] § 111.81 Settlement and compromise. The Executive Assistant Commissioner may settle and compromise any disciplinary proceeding which has been instituted under this subpart according to the terms and conditions agreed to by the parties including, but not limited to, the assessment of a monetary penalty in lieu of any proposed suspension or revocation of a broker's license or permit. [CBP Dec. 22-21, 87 FR 63321, Oct. 18, 2022] Subpart E—Monetary Penalty and Payment of Fees § 111.91 Grounds for imposition of a monetary penalty; maximum penalty. CBP may assess a monetary penalty or penalties as follows: (a) In the case of a broker, in an amount not to exceed an aggregate of $30,000 for one or more of the reasons set forth in § 111.53(a) through (g) other than those listed in § 111.53(b)(3), and provided that no license or permit suspension or revocation proceeding has been instituted against the broker under subpart D of this part for any of the same reasons; or (b) In the case of a person who is not a broker, in an amount not to exceed $10,000 for each transaction or violation referred to in § 111.4 and in an amount not to exceed an aggregate of $30,000 for all those transactions or violations. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63321, Oct. 18, 2022] § 111.92 Notice of monetary penalty. (a) Pre-penalty notice. (b) Penalty notice. [T.D. 00-57, 65 FR 53575, Sept. 5, 2000, as amended by CBP Dec. 22-21, 87 FR 63321, Oct. 18, 2022] § 111.93 Petition for relief from monetary penalty. A broker or other person who receives a notice issued under § 111.92(b) may file a petition for relief from the monetary penalty in accordance with the procedures set forth in part 171 of this chapter. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by T.D. 00-57, 65 FR 53575, Sept. 5, 2000] § 111.94 Decision on monetary penalty. CBP will follow the procedures set forth in part 171 of this chapter in considering any petition for relief filed under § 111.93. After CBP has considered the allegations or complaints set forth in the notice issued under § 111.92 and any timely response made to the notice by the broker or other person, the Fines, Penalties, and Forfeitures Officer will issue a written decision to the broker or other person setting forth the final determination and the findings of fact and conclusions of law on which the determination is based. If the final determination is that the broker or other person is liable for a monetary penalty, the broker or other person must pay the monetary penalty, or make arrangements for payment of the monetary penalty, within 60 calendar days of the date of the written decision. If payment or arrangements for payment are not timely made, CBP will refer the matter to the Department of Justice for institution of appropriate judicial proceedings. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 22-21, 87 FR 63321, Oct. 18, 2022] § 111.95 Supplemental petition for relief from monetary penalty. A decision of the Fines, Penalties, and Forfeitures Officer with regard to any petition filed in accordance with part 171 of this chapter may be the subject of a supplemental petition for relief. Any supplemental petition also must be filed in accordance with the provisions of part 171 of this chapter. § 111.96 Fees. (a) License fee; examination fee; fingerprint fee. (b) Permit application fee. (c) Permit user fee. Federal Register, (d) Triennial status report fee. (e) Method of payment. [T.D. 00-17, 65 FR 13891, Mar. 15, 2000, as amended by CBP Dec. 03-13, 68 FR 43630, July 24, 2003; 72 FR 3734, Jan. 26, 2007; CBP Dec. 17-05, 82 FR 29719, June 30, 2017; CBP Dec. 17-16, 82 FR 50530, Nov. 1, 2017; CBP Dec. 22-22, 87 FR 63267, Oct. 18, 2022; CBP Dec. 22-21, 87 FR 63321, Oct. 18, 2022] § 111.97--111.100 [Reserved] Subpart F—Continuing Education Requirements for Individual Brokers Source: CBP Dec. 23-04, 88 FR 41258, June 23, 2023, unless otherwise noted. § 111.101 Scope. This subpart sets forth regulations providing for a continuing education requirement for individual brokers and the framework for administering this requirement. The continuing broker education requirement is for individual brokers, in order to maintain sufficient knowledge of customs and related laws, regulations, and procedures, bookkeeping, accounting, and all other appropriate matters necessary to render valuable service to importers and drawback claimants. Individual brokers will be required to certify completion of the continuing broker education requirement with the filing of their 2027 status report, required under § 111.30(d), and every status report thereafter, in accordance with the provisions of this subpart. § 111.102 Obligations of individual brokers in conjunction with continuing broker education requirement. (a) Continuing broker education requirement. (1) During a period of voluntary suspension as described in § 111.52; or (2) When individual brokers have not held their license for an entire triennial period at the time of the submission of the status report as required under § 111.30(d). (b) Required minimum number of continuing education credits. (c) Reporting requirements. (d) Recordkeeping requirements General. (i) The title of the qualifying continuing broker education attended; (ii) The name of the provider or host of the qualifying continuing broker education; (iii) The date(s) attended; (iv) The number of continuing education credits accrued; (v) The location of the qualifying continuing broker education; and (vi) Any documentation received from the provider or host of the qualifying continuing broker education that evidences the individual broker's registration for, attendance at, completion of, or other activity bearing upon the individual broker's participation in and completion of the qualifying continuing broker education. (2) Availability of records. § 111.103 Accreditation of qualifying continuing broker education. (a) Qualifying continuing broker education. (1) Providers of qualifying continuing broker education. (i) Government agencies. (ii) Other providers requiring accreditation. (2) Recognized trainings or educational activities. (i) A seminar, webinar, or a workshop, whether online or in-person, whether experienced live or recorded, that is conducted by an instructor, discussion leader, or speaker; (ii) A symposium or convention, with the exception of the attendance at a meeting conducted in accordance with the provisions of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), whether online or in-person; (iii) Online coursework, a workshop, or a module, conducted as self-guided education, culminating in a retention test; (iv) The preparation of a subject matter for presentation as an instructor, discussion leader, or speaker at a training or educational activity described in paragraph (a)(2)(i) or (a)(2)(ii) of this section, subject to the requirements set forth in paragraph (b) of this section; and (v) The presentation of a subject matter as an instructor, discussion leader, or speaker at a training or educational activity described in paragraph (a)(2)(i) or (a)(2)(ii) of this section, subject to the requirements set forth in paragraph (b) of this section. (b) Special allowance for instructors, discussion leaders, and speakers. (i) Presenting subject matter as an instructor, discussion leader, or speaker at a training or educational activity described in paragraph (a)(2)(i) or (ii) of this section; or (ii) Preparing subject matter for presentation as an instructor, discussion leader, or speaker at a training or educational activity described in paragraph (a)(2)(i) or (ii) of this section. (2) The special allowance for instructors, discussion leaders, and speakers is subject to the following limitations: (i) For any session of presentation given at one time, regardless of the duration of that session, an individual broker may claim, at a maximum, one continuing education credit for the time spent preparing subject matter for that presentation pursuant to paragraph (b)(1)(ii) of this section. (ii) Per triennial period, an individual broker may claim, at a maximum, a combined total of 12 continuing education credits earned in accordance with paragraphs (b)(1)(i) and (ii) of this section. (3) Regardless of whether the training or educational activity is offered by a U.S. government agency or another provider, any instructor, discussion leader, or speaker seeking to claim continuing education credit in accordance with paragraph (b)(1) of this section must obtain the approval of a CBP-selected accreditor. (c) Selection of accreditors. et seq. Federal Register (d) Responsibilities of CBP-selected accreditors. (e) Prohibition of self-certification by an accreditor. § 111.104 Failure to report and certify compliance with continuing broker education requirement. (a) Notification by CBP. (b) Required response to notice. (1) Submit a corrected status report that, in accordance with § 111.30(d), reflects the individual broker's compliance with the continuing broker education requirement, if the individual broker completed the required number of continuing education credits but failed to report and certify compliance with the requirement as part of the submission of the status report; or (2) Complete the required number of continuing education credits of qualifying continuing broker education and submit a corrected status report that, in accordance with § 111.30(d), reflects the individual broker's compliance with the continuing broker education requirement, if the individual broker had not completed the required number of continuing education credits at the time the status report was due. (c) Suspension of license. (d) Revocation of license.