(Sandler and Travis)
The
unmistakable message from U.S. Customs and Border Protection (CBP) officials speaking at last week's Customs Symposium in Washington was that security issues will continue to dominate the agency's approach to trade
policy in the years to come. Senior managers repeatedly called on the trade community to re-capture the sense of urgency that prevailed immediately after the September 11, 2001, terrorist attacks. This message was
clearly part of an effort to prepare traders for the expansion and tightening of cargo security programs.
Virtually all of the two-day conference was dedicated to the various aspects of supply chain security,
with traditional customs issues such as compliance, regulations, and rulings all but ignored. Indeed, one official said plainly that all of CBP's constituent branches have as a primary focus the issue of how their
traditional missions affect the agency's priority mission of homeland security.
Within this context, it was no surprise that much of the discussion at the symposium centred on two topics: (1) the development of a
national cargo security strategy, a draft of which was circulated by the Department of Homeland Security (DHS) last month; and (2) overhauling the Customs-Trade Partnership Against Terrorism (C-TPAT). This article will
focus on the latter, particularly the more stringent participation criteria that CBP is considering and the additional benefits it plans to implement.
Participation Criteria
CBP officials stressed that they plan to maintain C-TPAT as a
voluntary program for the foreseeable future, rather than one governed by regulatory requirements. A strategic plan released during the symposium noted that C-TPAT needs to remain "a dynamic, flexible program
designed to keep pace with the evolving nature of the terrorist threat and the changes in the international trade industry." The plan added that because C-TPAT has "security requirements that allow for
customized application," most participating companies not only meet but exceed the minimal standards of the program.
However, CBP is also planning a major effort to strengthen the criteria for C-TPAT
participation. In short, CBP is looking to push the program all the way back down the supply chain to the point of manufacture so that it can obtain more and better information about every step of an item's journey to
the U.S. market. It is clear, though, that CBP is in the early stages of this effort. The agency is therefore looking for input from the trade community as to what additional data can and ought to be provided and how to
expand C-TPAT participation to other entities in the supply chain.
(Over 8,000 companies have now enrolled in C-TPAT. CBP says 40 per cent of total U.S. imports by value are entered by C-TPAT companies, a figure
it hopes to increase to 60 per cent by the end of 2005. Mexican manufacturers are currently the only foreign manufacturers allowed to enroll, but CBP plans to expand eligibility to Canadian firms soon.)
Benefits
Officials at the symposium spent a good deal of time
outlining the benefits of C-TPAT participation, something the trade community has consistently pressed CBP to quantify.
The most cited statistic was that C-TPAT shipments are subject to six times fewer
enforcement examinations and four times fewer compliance exams. Other benefits that CBP continues to assert but has done little to quantify include streamlined company operations and reductions in cargo theft and
pilferage.
However, nearly three years after the program's inception, CBP has still not come up with a firm plan for when and how to implement one of the primary benefits it has pledged for C-TPAT companies,
expedited cargo processing. It is in this area that CBP will apparently focus its efforts this year, reasoning that it will have to offer concrete, money-saving results in return for the additional measures it plans to
ask participants to take.
Specifically, CBP will engage the trade community in developing a "green lane" for imports. This concept envisions a process whereby approved cargo can enter the U.S.
virtually unimpeded. However, CBP is also considering a system of tiered benefits where only shipments that meet the most stringent criteria would receive the fastest processing. These criteria would likely include:
validated C-TPAT participation for all of the importer's supply chain partners; transportation of goods in a "smart box" equipped with tamper-evident seals; and shipment of goods through foreign ports
participating in the Container Security Initiative (CSI). Some type of security standard regarding container stuffing may also be involved.
(In a related note, Commissioner Robert Bonner noted that CBP plans to
expand CSI to 40 ports by the end of 2005 and 50 by the end of 2006. This expansion is expected to include Buenos Aires (Argentina), Santos (Brazil), Balboa and Colon (Panama), Shanghai and Shenzhen (China), Colombo
(Sri Lanka), Kaohsiung (Taiwan), Izmir (Turkey), Dubai (United Arab Emirates), Lisbon (Portugal), and Barcelona and Valencia (Spain).)
How exactly to implement the green lane is turning out to be more
problematic. It is somewhat easier in the land environment, where CBP is already designating Free and Secure Trade (FAST) lanes on the northern and southern borders that allow truckers carrying C-TPAT loads to enter the
U.S. more quickly, especially where the road structure allows faster access to a primary screening point to deliver these benefits.
For ocean-borne containers, officials said they want to hear from the trade
community as to what a green lane should mean. |
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