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U.S. CUSTOMS TRADE SYMPOSIUM 2002 REPORT
"PARTNERING FOR SMART BORDERS
AND SECURE TRADE"
November 20-22, 2002
From: Jim Phillips
Deputy Customs Commissioner Doug Browning
- Symposium is for Customs/Stakeholders jointly to address issues of mutual interest.
- Great need for continuing innovation and cooperation.
- Increasing security carries responsibility to enhance facilitated flow of low-risk.
- Customs has dual goals - economic security facilitation / security and enforcement. Balance-insuring efficiency in trade is economic reality.
- Customs is dedicated to work with the Trade Community for efficient low-risk facilitation.
Customs Commissioner Bonner
- Welcomed Canada Customs representatives. Cited very close relationship with Canada Customs and benefits of U.S./Canada trade.
- Homeland Security Presidential initiative is bold and absolutely essential.
- Defenses beyond borders to identify and interdict threats CSI, CTPAT, FAST.
- Customs achieve reasonable/responsible security AND assure efficient flow of trade to protect U.S. economy. TWIN GOALS not mutually exclusive CSI, CTPAT,
FAST.
- Objective is to insure security and achieve lower costs to trade. Key is identifying and streaming known low risk goods using risk management.
- Smart Border involves supply chain adding security earlier, using electronic data pre-arrival making Ports-of-Entry more efficient. Customs must hone
skills.
- Discussed CTPAT (1000 companies have signed MOU especially ocean carriers and brokers), tamper proof containers (smart box), rapid development of CSI (15
of the 20 mega ports signed on covering 50% of all containers destined for U.S.), summarized the 24-hour rule and its critical importance.
- Described FAST program with Canada at the 6 major commercial crossings - is a modified NCAP/CSA with transponder (3 green lights company/truck/driver)
with no stop at border. The other coming release mechanism for fast expedited release is a modified Pre Arrival Processing System (PAPS) essentially needing only a bar code and fax machine.
- A 4-year time frame to complete ACE is the Commissioner's stated goal.
- In partnership with the trade community we can make smart borders and we can secure trade.
ROUNDTABLE WITH CUSTOMS ASSISTANT COMMISSIONERS
Regulations and Rulings process was described - 90-day limit on making rulings is being met. Described CROSS the web based system that has 90,000 rulings for reference and is getting 7,500 visits a month.
Strategic Trade and related regulatory analysis/audits discussed including focused assessments that involve joint problem solving, importer self-assessment for those who have proven to be highly compliant.
Field Operations has been restructured. Focused on Border Security and Facilitation and Trade Compliance and Facilitation. API is timely accurate information and 99% compliant. Described technology deployment at Ports-of-Entry, portal radiation detectors and gamma imaging systems. CTPAT has 1015 participants (764 importers, 99 carriers and 252 brokers). It is critical to secure the perimeter.
International Affairs is implementing the Container Security Initiative (CSI) as a primary priority. Global impact of maritime containers is immense as they handle 90% of world trade. They pose a real threat with serious consequences. Described activities with World Customs Organization (WCO) and APEC cooperation on anti-terrorism.
CUSTOMS TRADE PARTNERSHIP AGAINST TERRORISM (CTPAT) - SUPPLY CHAIN SECURITY BEST PRACTICES
U.S. Customs personnel going to CSI ports 4-12 personnel at each to then determine final number needed at each. Reviewing Northern Border infrastructure using
modeling. Considering pilots on some elements with Mexico. Cannot ignore the reality of Southern Border unique problems with drugs and illegal alien smuggling. Need timely and accurate information.
U.S. Customs partners are Congress, Foreign Governments, Other U.S. Government Agencies and the Private Sector.
CTPAT prevents attacks, Memo of Understanding to sign on is not a contract, does not require major spending for most. It helps determine best practices and
helps others raise their capabilities. Those already signed on to CTPAT comprise 34% of the total import dollars, 55 of the top 100 container volume importers and 32 of the top 50 Ocean carriers which carry 93% of
the total U.S. bound container cargo. Participants get the fast lane for release and border processing. CTPAT has security specialists, makes security validations focused and limited to submissions for
self-policing. Plans are to share and jointly develop.
Executives from Nissan, Maersk and C.H. Powell companies discussed their experiences and views of CTPAT. Accomplished with no extra staff and confidentiality.
All realized you are either a member of CTPAT or you are unknown and presumed a risk with related consequences. Clock is ticking, trade is key to world economy, and CTPAT is cost effective, practical and
appropriate. Need clear rules and statement of what is expected. Never forget terrorists are out to destroy our way of life.
STRENGTHENING OUR BORDERS THROUGH SCIENCE AND TECHNOLOGY
Described integrated technical support for non-intrusive inspection, enforcement support and surveillance/interdiction support. Reviewed specific types of
x-ray, gamma ray, and radiation equipment and installations Customs employs.
Detailed the Customs Laboratory and Scientific Support Services highlighting the four focus areas: Trade and Trade support (intellectual property, software);
Forensic (Crime Scene); Weapons of Mass Destruction Identification and fast response team and Radiation Technical Assistance. Specific examples given: 15% of all pharmaceutical shipments into the U.S. have no active
ingredients as stated but are only starch and sugar; 90% of all pharmaceutical shipments are illegal; at the Olympics the labs found 2 explosive devices, 1 biological device and identified $400,000 of counterfeit
Olympic goods.
The status of ACE development was presented for the 2003-2007 timeframe to completion. Involves account managers, border security, web portal cargo
processing. All ports are consolidated.
IMPORTER SELF-ASSESSMENT - TAKING CHARGE OF YOUR OWN COMPLIANCE
With customs twin goals, ISA is a great facilitation tool. To join ISA one must be in CTPAT. General Motors, Delphi and Nissan are the first MOU agreements.
ISA is only for already trade compliant companies.
Currently completing an ISA for an industry group, Petroleum, which is comprised of specific companies who are 20% of the top 100 importers, $84.5 billion in
volume, also covering Free Trade Zone and duty drawback activities. Four product lines are detailed: crude, jet fuel, gas and residual oil in bulk or pipeline. The MOU is drafted, questionnaire completed and the
risks/controls matrix is in progress. The automotive industry is next. British Petroleum executive described their experiences.
Hasbro Toys executive described their progress to achieve ISA status. They move 17,500 TEU's a year, are number 2 in the industry with $2.9 billion in sales.
Their objective is to be designated low risk status as they have a high compliance rate. It was interesting that the major toy companies all buy from the same suppliers which makes securing the supply chain more
focused and central in their industry.
U.S. Customs described the computer system "One Track" they have developed for ISA designated importers. It is truly amazing providing meaningful analysis of
a companies transaction history.
24-HOUR ADVANCE MANIFEST REGULATION
The 24-hour rule is essential to negate terrorism threats and will become operational in 70 days period. It gives targeting data and opportunity to identify
high-risk prior to loading. It requires precise descriptions or 6 digit HTS code. Vendor ID confidentiality provided, Office of Disclosure Law will screen out. Automated Manifest System (AMS) will ultimately accept
no paper manifests. Perishable situation needs to be worked out to solve needs of both parties.
TRADE ACT OF 2002 SECTION 343
Rule 343 focuses on cargo not mode. Air, Truck, Rail and Sea will all be covered to provide ability to target the cargo.
Inbound:
Air- paperless, pre-lading, full house bill info.
Rail-
paperless, pre-lading, full manifest including house bill info
Sea Vessel- 24-hour rule prior to loading
Truck-
January 2004 ACE, automated, port by port at northern land
border use PAPS
Outbound:
5 percent of Customs resources are spent on outbound for trade statistics, controlled items and especially currency. Automated Export
System (AES) eliminated export deck covers 1.6 million transactions a month (85% of total).
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