CBP's Answers to Questions Submitted at its January 2005 Trade Symposium (Part II)

(CBP's 2004 Trade Symposium was held on January 12-14, 2005 in Washington, DC. See ITT's Online Archives or 01/27/05 and 01/28/05 news, 05012710 and 05012810, for Parts I and II of BP's summary of this trade symposium.)

This is Part II of a multi-part series of summaries on this document, and provides "highlights" of some of the questions and answers concerning global supply chain security. (See future Part for highlights of the rest of the questions and answers on global supply chain security and on other topics. See ITT's Online Archives or 06/10/05 news, 05061005, for Part I.)

Highlights of Questions & Answers on Global Supply Chain Security

The following are highlights of some of the questions and answers related to global supply chain security:

A "known shipper" program for ocean cargo is not currently anticipated. In response to a question on whether there will ultimately be a shipper's security endorsement or known shipper requirement for ocean cargo as was developed for air cargo post 9/11 and if so, would a "known to one, known to all" policy follow, CBP states that it does not currently anticipate implementing a "known shipper" program at this time. However, CBP states that it, in coordination with other Department of Homeland Security (DHS) agencies, continues to evaluate ocean cargo supply chain security in an effort to identify new initiatives or programs that will enhance cargo security.

CBP's task of validating 8,000 C-TPAT participants. A questioner asked how CBP perceives conducting a validation on 8,000 Customs-Trade Partnership Against Terrorism (C-TPAT) participants and what the future is for the validation process.

CBP responds that it recognizes the importance of validating member security profiles and has increased the number of Supply Chain Specialists (SCSs). Direct appropriations from Congress in fiscal year (FY) 2005 will allow for the hiring of an additional 120 SCSs. In addition, CBP states that it has employed new validation strategies and approaches that will allow for a greater efficiency and effectiveness to the validation process.

Private audit groups will not be conducting C-TPAT validations. A questioner asked what can be expected as far as C-TPAT funding and how effective can the current program be with audits occurring every several years. The questioner asked if there has been any thought to having C-TPAT members adhere to (and pay for) annual audits by CBP-appointed public audit groups (such as Lloyd's, big CPA firms, FedEx Trade Group, etc.).

CBP states that it strongly believes that the responsibility for validating security measures lies within the agency, and that this crucial responsibility should not be contracted out. During a validation, members afford CBP SCSs complete and open access to all facets of their business, which is crucial to conducting a comprehensive validation that better serves the member and CBP.

According to CBP, it is questionable whether this same level of openness and cooperation would exist if outside validators were to be used, since the same contractor validating a member today may be validating their competitor tomorrow. CBP again notes that it has increased the number of SCSs, and is using validation strategies and approaches that will allow for greater efficiency and effectiveness in the process.

Third party logistics companies' ineligibility for C-TPAT. In response to a question on why logistics companies are not eligible for C-TPAT certification and participation given the high level of intervention of logistics providers in supply chain management, CBP states that C-TPAT membership at present is limited to those importers, carriers, brokers, and others whose goods cross the border into the U.S.

CBP states that it recognizes the important role third party logistics providers play in the international supply chain, which is why the logistics relationship is one portion of a company's business model that is closely reviewed during the validation process.

Additional China ports joining CSI. In response to a question on when larger ports in China will join CSI (specifically, Yantian, Xiamen and Ningbo), CBP states that it will have CSI teams in Shanghai and Shenzhen (Yantian) in the very near future. At present, there are no plans to staff Xiamen and Ningbo with CSI personnel.

(See ITT's Online Archives or 05/02/05 news, 05050215, for BP summary of Shanghai becoming the 36^th CSI operational port and plans to open CSI in Shenzhen in the coming months.)

CBP Answers to Question Cards Submitted at the Trade Symposium 2004 available at http://www.cbp.gov/linkhandler/cgov/import/communications_to_industry/trade_2004/trade_answers.ctt/trade_answers.doc