Incoterms Guide: Professional Nuance That Matters in Brokerage Practice

Everyone reading this knows what an Incoterm is.

The question isn’t what FCA or CIF mean in theory. The question is how those terms appear in entry documentation, valuation, and real-world compliance — especially when commercial contracts and operational execution don’t align perfectly.

For customs brokers and forwarders, Incoterms are not educational trivia. They are valuation triggers, audit exposure points, and sometimes the difference between a clean entry and a Customs inquiry.

This Incoterms Guide takes a closer look at where professional nuance matters.

Incoterms and Entered Value: Where the Details Count

One of the most overlooked areas in brokerage practice is the relationship between Incoterms and entered value.

Prepaid international freight charges may be deductible from the entered value — but only when properly supported and clearly segregated.

If the sales contract is written on a CIF, CPT, or CIP basis, the invoice often reflects bundled freight. The broker’s responsibility is to:

• Confirm whether freight is included in the invoice price

• Obtain supporting documentation to substantiate deductions

• Ensure the deduction aligns with valuation rules
   

This is not academic. Incorrect or missed deductions create exposure for both the broker and the importer.

Understanding the terms of sale isn’t about education. It’s about defensible entries.

FOB and Container Freight: The Persistent Habit

Most professionals understand that FOB was designed for non-containerized ocean cargo. Yet FOB continues to appear on container shipments.

The issue isn’t vocabulary. It’s risk transfer versus documentary consistency.

When the contract says FOB but operational control reflects something closer to FCA, questions arise:

• Who controlled the freight booking?

• Where did risk actually transfer?

• Does the commercial documentation match the physical movement?
   

Misalignment doesn’t automatically create non-compliance, but it can complicate valuation and audit trails.

Brokers who flag inconsistencies early position themselves as advisors, not data processors.

DDP: The Compliance Exposure Term

DDP remains one of the most commercially attractive and operationally risky Incoterms in U.S. transactions.

When a foreign seller agrees to deliver duty paid:

• Who is acting as importer of record?

• Is there a valid power of attorney?

• Is the seller properly structured for U.S. compliance obligations?
   

Too often, DDP is agreed to in sales negotiations without the corresponding infrastructure.

For CCBFA members, this is where professional leadership matters. Clarifying regulatory responsibility before goods move prevents downstream liability.

Prepaid Freight Deductions and Audit Preparedness

CBP scrutiny of valuation continues to increase. When freight is prepaid and deducted from the entered value, documentation discipline is critical.

Best practice includes:

• Clear separation of freight on commercial invoices

• Supporting freight invoices

• Internal documentation explaining valuation methodology
   

Incoterms do not determine valuation — but they signal where brokers should ask questions.

Why This Matters for CCBFA Members

The association represents professionals who already understand the mechanics of trade.

The added value is in reinforcing professional standards:

• Identifying valuation nuances

• Managing edge cases

• Leading client conversations before issues escalate
   

Incoterms fluency is not about definitions. It is about protecting entries, reducing audit exposure, and elevating the broker's role in the transaction.

Defined terms. Defensible filings.

That’s professional practice.

Supply Chain Resilience: Professional Lessons for Brokers and Forwarders

The past several years have tested every supply chain assumption.

For brokers and forwarders, disruption was not theoretical. It was operational pressure layered on top of regulatory accountability.

The conversation now is not whether disruption exists. It is how brokerage and forwarding professionals build supply chain resilience into their service model.

Here are the lessons that apply directly to our profession.

Diversification as an Advisory Function

When trade lanes stalled and sourcing shifted, brokers and forwarders were often the first call.

Members who understood alternate ports, inland routings, FTZ options, and bonded strategies moved beyond transaction processing into advisory roles.

Supply chain resilience is no longer just the shipper’s responsibility. Brokers who can articulate routing alternatives and regulatory implications add measurable value.

Chicago’s intermodal strength makes that advisory capacity tangible.

Communication as Risk Management

During peak disruption, certainty was rare.

The brokers who retained trust were those who communicated early, clearly, and frequently — even when answers were incomplete.

From a professional standpoint, documentation of those communications also matters. When timelines shift and expectations change, written confirmation protects both broker and client.

In volatile conditions, communication is not customer service. It is risk management.

Compliance Under Pressure

Disruption did not slow enforcement. If anything, forced labor scrutiny, FDA reviews, and ACE oversight intensified.

Operational strain increases the risk of shortcuts. That is precisely when internal controls matter most.

Members who maintained disciplined filing practices during disruption demonstrated what supply chain resilience looks like in brokerage practice.

Clean entries during chaotic conditions are not accidental.

Inventory Strategy and Entry Planning

As shippers reevaluated safety stock and nearshoring strategies, brokers were pulled into higher-level planning discussions.

Bonded warehousing, FTZ utilization, and duty planning became strategic levers.

For Chicago professionals, inland positioning created opportunity:

• Rail staging
   

• Regional distribution hubs
   

• Entry timing strategies
   

Brokers who understand the regulatory implications of inventory positioning contribute directly to enterprise-level decisions.

Relationships as Operational Leverage

Visibility platforms improved, but relationships still resolved problems.

Established connections with terminals, carriers, CBP personnel, and warehouse operators often determined whether a problem stalled or moved.

The Chicago trade community’s collaborative culture remains a competitive advantage.

Professional networks are part of supply chain resilience.

The Role of CCBFA

For members of the Chicago Customs Brokers and Forwarders Association, resilience is both collective and individual.

Shared knowledge, regulatory updates, and peer discussion strengthen the region’s trade gateway.

Supply chains may remain complex.

But disciplined professionals, informed through association engagement, make them steadier.

Resilience is built before the next disruption arrives.

Chicago has long been a powerhouse in U.S. trade, acting as a vital hub for air, rail, and road cargo moving across the country and beyond. As one of the nation's most critical inland ports, the city’s trade infrastructure plays a central role in the daily work of customs brokers, freight forwarders, importers, and exporters. For members of the Chicago Customs Brokers and Forwarders Association (CCBFA), understanding the evolving dynamics of this infrastructure is key to staying ahead.

Key Advantages of Chicago’s Trade Ecosystem

• Centrally located, Chicago’s geography provides unmatched access to both coasts, major manufacturing regions, and Canadian markets, making it a strategic point for freight consolidation and distribution.

• Intermodal Connectivity, as one of the largest rail hubs in North America, O’Hare International Airport’s global cargo reach, and a robust trucking network, enable members to move goods efficiently across multiple modes.

• Customs Support Infrastructure provides proximity to CBP facilities, FDA offices, and key Partner Government Agencies, helping reduce processing delays and support accurate entry filings.
  Experienced Workforce: the city is home to a highly skilled logistics and compliance workforce, supported by long-standing CCBFA training programs and industry collaboration.

Current Challenges for Brokers and Forwarders

• Congestion and Delays, truck bottlenecks around O’Hare, rail backlogs, and limited drayage capacity strain supply chains and compress cut-off windows for time-sensitive cargo.

• Infrastructure Gaps: While investment continues, outdated roadways and limited cross-docking facilities in specific industrial corridors slow throughput and increase costs.

• Regulatory Complexity, evolving compliance requirements—from forced labor laws to FDA holds—require constant attention and up-to-date knowledge for successful filings.

• Warehouse Availability, industrial real estate near O’Hare remains tight, making space planning and cargo staging a challenge for many importers and service providers.

Join the Conversation. Shape the Future.

If you're not already a CCBFA member, now is the time. Your voice is critical to solving the challenges and shaping the opportunities facing Chicago’s trade community. Through education, advocacy, and industry connections, CCBFA helps customs brokers and forwarders not just adapt—but lead.

Become a member today and help make the Midwest trade gateway stronger, smarter, and more efficient.

Five Emerging Trends Every Customs Broker Should Watch in 2026

As global trade shifts under new pressures—from digitalization to geopolitics—customs brokers are standing at a critical crossroads in 2026. To remain competitive and compliant, it’s no longer enough to be reactive. Today’s customs professionals must be strategic, forward-looking, and technology-ready.

Here are five emerging trends every customs broker should have on their radar this year:

1.  AI and Automation in Trade Documentation

Artificial intelligence is moving beyond buzzword status and into real-time customs operations. From automating entry data validation to AI-powered anomaly detection in compliance reporting, digital tools are transforming how brokers process paperwork. Expect to see broader adoption of tools that integrate AI with existing software platforms, resulting in faster clearance and fewer errors.

2.  Expanding U.S. Trade Agreements and Regional Shifts

In 2026, the U.S. is actively renegotiating and expanding trade relationships in the Indo-Pacific and Latin America. Brokers must rapidly pivot to stay current on the rules of origin, tariff rate quotas, and customs procedures under emerging frameworks. Education is no longer a yearly update but a constant flow of changes that affect the real costs of a supply chain. The trend toward nearshoring also means new import/export flows and compliance risks to monitor.

3.  ACE Portal Advancements and Broker Accountability

CBP continues to enhance the ACE Portal, including expanded analytics and new ACE 2.0 modules. Along with technical upgrades comes increased scrutiny on brokers to ensure accuracy in entry summaries, ISF filings, and PGA coordination. Proactive data management and internal audits are becoming best practices—not just good ideas.

4.  Digital Compliance and eInvoicing Mandates

Countries around the world are mandating digital customs filings and eInvoicing. The EU, Mexico, and Brazil are setting the pace, and the U.S. could follow. Brokers should be preparing their clients for system integration, format changes, and data retention rules—especially for multinational shippers.

5.  Cybersecurity and Supply Chain Risk

With growing digital interconnectivity comes vulnerability. Cyber threats targeting freight forwarders and customs brokers are increasing in frequency. In 2026, expect more pressure on brokers to adopt robust cybersecurity protocols, especially as federal agencies move toward stricter digital trade security standards.

The customs broker of the future needs more than wisdom and experience—they're a strategist, technologist, and compliance expert. By staying ahead of these emerging trends, brokers can add value, build trust, and protect clients in an increasingly complex trade environment.

Are you ready for the next generation of customs challenges? Join CCBFA Chicago to stay connected, informed, and influential in shaping the future of trade.

As global trade shifts under new pressures—from digitalization to geopolitics—customs brokers are standing at a critical crossroads in 2026. To remain competitive and compliant, it’s no longer enough to be reactive. Today’s customs professionals must be strategic, forward-looking, and technology-ready.

Here are five emerging trends every customs broker should have on their radar this year:

1.  AI and Automation in Trade Documentation

Artificial intelligence is moving beyond buzzword status and into real-time customs operations. From automating entry data validation to AI-powered anomaly detection in compliance reporting, digital tools are transforming how brokers process paperwork. Expect to see broader adoption of tools that integrate AI with existing software platforms, resulting in faster clearance and fewer errors.

2.  Expanding U.S. Trade Agreements and Regional Shifts

In 2026, the U.S. is actively renegotiating and expanding trade relationships in the Indo-Pacific and Latin America. Brokers must rapidly pivot to stay current on the rules of origin, tariff rate quotas, and customs procedures under emerging frameworks. Education is no longer a yearly update but a constant flow of changes that affect the real costs of a supply chain. The trend toward nearshoring also means new import/export flows and compliance risks to monitor.

3.  ACE Portal Advancements and Broker Accountability

CBP continues to enhance the ACE Portal, including expanded analytics and new ACE 2.0 modules. Along with technical upgrades comes increased scrutiny on brokers to ensure accuracy in entry summaries, ISF filings, and PGA coordination. Proactive data management and internal audits are becoming best practices—not just good ideas.

4.  Digital Compliance and eInvoicing Mandates

Countries around the world are mandating digital customs filings and eInvoicing. The EU, Mexico, and Brazil are setting the pace, and the U.S. could follow. Brokers should be preparing their clients for system integration, format changes, and data retention rules—especially for multinational shippers.

5.  Cybersecurity and Supply Chain Risk

With growing digital interconnectivity comes vulnerability. Cyber threats targeting freight forwarders and customs brokers are increasing in frequency. In 2026, expect more pressure on brokers to adopt robust cybersecurity protocols, especially as federal agencies move toward stricter digital trade security standards.

The customs broker of the future needs more than wisdom and experience—they're a strategist, technologist, and compliance expert. By staying ahead of these emerging trends, brokers can add value, build trust, and protect clients in an increasingly complex trade environment.

Are you ready for the next generation of customs challenges? Join CCBFA Chicago to stay connected, informed, and influential in shaping the future of trade.

Dear Members, 

If you missed the chance to engage with the THE INS AND OUTS OF THE ACE PORTAL webinar live on Tuesday February 8, 2022, we have the VOD here for your utilization!

Come get tips and tricks to help you with the ACE Portal. Have you watched all the Videos on Reports? Have you read all the training Guides? We will cover things not included in the Videos and Guides.

We will cover the following and more: Export Reports, More on how to make your own reports not use the canned reports, How to add employees to your portal, How to remove employees from the portal when they no longer work for your company, How to best use the ADD/CVD tool, How to use the ISF tool, How to upload your documents in the portal for DIS , More in-depth on Post Summary Corrections, Protests in the Portal.

Speakers:  Carlos Rodriguez, Information Technology Specialist, National ACE / PGA SCO, Readiness and Deployment Branch, Trade Transformation Office, Office of Trade, U.S. Customs and Border Protection

Cargo Systems Messaging Service  CSMS #41151809

Information on Bills Issued Prematurely for Some Informal Entries.

Due to the federal holiday on December 24, some informal entries were liquidated prematurely on December 25 with incorrect bill amounts. These bills will be cancelled, the entries will be re-liquidated, and any bills will be re-issued with the correct amounts.

CSMS #41149692 - U.S.-Japan Trade Agreement: Information on Claiming Preferential Treatment

The US-Japan Trade Agreement (“Agreement”) will enter into force on January 1, 2020.  This message is to inform the trade community of the requirements for claiming preferential treatment under this new Agreement. 

In order to receive preferential treatment, a good must be originating and meet all the requirements of the U.S.-Japan Agreement. 

Annex II to the Agreement specifies the rules of origin used to determine if a good qualifies for preferential tariff treatment or “originates” under the Agreement.  The product-specific rules (Annex II to the Agreement) specify the level of change of tariff classification that non-originating materials must undergo.  General Note 36 will be added to the HTSUS and will include the requirements of the Agreement. The links to the US-Japan Trade Agreement text and related documents are below.

FILING INSTRUCTIONS:

• From January 1, 2020 through January 13, 2020, importers must pay duties on qualifying goods under the Agreement and request a preferential tariff retroactive claim by filing a post summary correction (PSC) to request the duty refund.  The Automated Commercial Environment (ACE) will accept the new special program indicator ‘JP’ as a prefix to the eligible tariff number on January 14, 2020.
• On or after January 14, 2020, ACE will accept the new special program indicator ‘JP’ as a prefix to the eligible tariff number. Importers claiming preferential treatment under the Agreement must include on the entry, the special program indicator “JP” as a prefix to the eligible tariff number for each qualifying good requesting such preference.

To claim preferential tariff treatment under the U.S.-Japan Trade Agreement, the following requirements must be met:

1. Country of Origin must be ‘JP’
2. Country of Export must be ‘JP’
3. Once programmed in ACE, the Special Program indicator 'JP' must be placed before the eligible tariff number to make the claim. 
4. Claims for preferential treatment under this Agreement are not exempt from the merchandise processing fee (class code 499 and class code 311).
5. The tariff-rate quota allocation for beef from Japan is modified as follows:
   • The country specific Japan beef quota (200,000 kg) is eliminated and added to “other countries.” This updates the “other countries or areas” limit to 65,005,000 kg.
   • There is no change to the entry filing process. The ACE quota module will process eligible beef from Japan under the “Other countries or areas” quota.

More details on US-Japan implementing instructions will be provided on 

Dear Members of the CBFAA,

Please  note updated contact information from FDA. Chicago and Illinois ports are under the jurisdiction of FDA Division of Northern Border Imports.  Please see the PGA folder on this website for the complete list of Northern Border FDA Port Offices which comprise the states of ID, IL, IN, MI, ME, MN, MT and ND.

, Director, Investigations Branch (West)

Vacant, Director, Compliance Branch (West)

Compliance Branch: If you need to contact the monitoring Compliance Officer, please use the specific contact information provided on your FDA Notice of Action.

Entry documents and electronic private laboratory analytical packages can be submitted using the Import Trade Auxiliary Communication System (ITACS) at https://itacs.fda.gov.

Electronic private laboratory analytical packages may also be submitted via email to the Compliance Officer listed on the FDA Notice of Action.

The status of an entry may be checked using the Import Trade Auxiliary Communication System (ITACS) at https://itacs.fda.gov.

Division of Northern Border Imports

Division Management Overview

Sandra K. Sylvester, Acting Division Director

Vacant, Director, Investigations Branch (East)

Sherea Dillon, Director, Compliance Branch (East)

Eric Joneson

Hello, Dear Members -
Several of the Board members attended Mary Aikens' retirement luncheon at CBP's office earlier this week on Tuesday, March 21st. Those of you who attended our Holiday Party 2016 recall that we honored Mary with the Gene Nikliborc Outstanding Service Award.

At the luncheon, it was our great pleasure to honor Mary with an engraved world clock to commemorate the award. Mary started her career in 1975 at headquarters and then moved to Chicago in 1977, where she served as an inspector in both Cargo and Passenger Processing. In January of 1989, she left the uniformed job and transferred to the Port of Chicago District office, where she served the next 13 years as Deputy Entry Officer. In 2002, Mary became Chief Entry Officer and served in this role until her retirement very soon.

We are honored to have experience Mary's service, knowledge and friendship over the years and wish her the best in a relaxing retirement!

Happy Spring to All!
Jane Sorensen

On Tuesday, March 1st, the NCBFAA  released a Monday Morning eBriefing newsletter, which focused on the recent statement that was made by the United States Coast Guard (USCG).

According to the NCBFAA eBriefing,  the USCG took a moment to clarify its position on the International Maritime Organization (IMO) and the new carrier guidelines that require the exporter that is listed on carrier’s master bill of lading to provide a certification of the Verified Gross Mass (VGM) of any container (including the tare weight of the container) tendered to the vessel operators.

There is no need to change processes

Admiral Paul Thomas of the USCG advised that the Coast Guard would need to implement the IMO’s changes through an appropriate regulatory rulemaking, before the IMO can compel the U.S. shippers and carriers to change their current business practices.

It was said that current ly the USCG feels that today’s process are     working as long as both the shipper and carrier has done their job    properly.  Since there is nothing deficient or inherently unsafe about existing export processes, the Coast Guard feels that there is no need to change processes and will not do anything to enforce the new VGM rules on either the U.S. shippers or carriers .

It is assumed that the carriers will not accept this and will continue to push U.S. exporters and OTIs to still provide a VGM  certificate.  This will be monitored carefully by the NCBFAA.

AESDirect has been moved to the ACE portal.  At this time, you can still access the AES Direct; however, it is the intent for CBP/ Census to move the login and password to ACE Portal.

It is just a matter of getting everyone signed on with a new password and login.    You may ask, "Why do we need to be on the ACE Portal, if we already link with AES through our software system?".  You can file AES through the ACE Portal,  if your system goes down.   The AESDirect via ACE Portal is a good back up for this purpose.  The sign up process takes a few days, so if you do not prepare in advance you will not be able to process AES through the ACE Portal.   When you are singed up, please note that the ACE Portal works best in Explorer. Firefox and Chrome work for the first screens, but anytime you want to drill into the system you will stop having functionality.

If you are a freight forwarder, the AES direct is located via the Exporter pull down view.    Then, go to Submit AESDirect Filings.  I recommend to send an EEI in the AESDirect in order to test that you know the process.

Once you are in the system you will find the program is user friendly.