CBP Testifies at Senate Finance Committee Hearing on Authorization of Customs and Trade Functions

Testifying at this hearing, were representatives from U.S. Customs and Border Protection (CBP); Department of Treasury; U.S. Immigration and Customs Enforcement (ICE); and International Trade Commission. Various trade participants also testified.

CBP Written Statement

The following are highlights of the written statement presented by Jayson Ahern, Assistant Commissioner, CBP Office of Field Operations.

45% of imported merchandise is imported by C-TPAT importers. According to Ahern, C-TPAT has approximately 6,000 certified members, including most of the largest importers. In addition, 45% of all merchandise imported into the U.S. is done so by C-TPAT member importers.

100% of C-TPAT certified members to be validated by end of 2007. In describing CBP's C-TPAT validation process, Ahern noted that the C-TPAT program has completed validations on 30% of the certified C-TPAT membership, up from 8% a year ago. In addition, Ahern stated that validations are in progress on another 35% of certified members and that these validations will be completed throughout 2006, bringing the total percentage of validated certified members to 65% by the end of 2006. In 2007, Ahern stated that the CTPAT program validations will continue and CBP will achieve 100% validation by the end of 2007.

FAST to be expanded to 13 new sites in 2006. Ahern stated that the Free and Secure Trade (FAST) program has enrolled 60,786 commercial drivers and expanded to eleven sites along the northern border and seven locations along the U.S./Mexico border. The FAST program will be expanding in 2006 to six sites along the northern border and seven locations along the U.S./Mexico border.

Truck e-Manifests. According to Ahern, the number of truck e-Manifests received in March 2006 grew 75% to 849 e-Manifests representing 146,712 shipments. There are now 197 Electronic Data Interchange (EDI) certified companies, including 181 carriers and 16 service centers. Four companies are in the testing stage.

1,736 ACE Portal accounts have been created. Ahern states that as of April 10, 2006, 1,736 ACE portal accounts had been created, including 486 importer, 314 broker, and 936 carrier accounts.

CBP lists five priority trade issues. In his testimony, Ahern listed the following as Priority Trade Issues (PTIs):

intellectual property rights

antidumping and countervailing duty

textiles and wearing apparel

revenue

agriculture

Ahern states that since 2003, its field management has been directed to configure their Import Specialist teams around these PTIs. Currently over 64% of the field Import Specialist workforce is assigned commodities with PTI implications.

Seizures, penalties, and liquidated damages. Ahern states that in FY 2005 it took the following actions for violations of laws and/or statutes:

Seizures - had over 114,301 seizures and collected and deposited $31,037,417 in seized currency and proceeds of sale of seized and forfeited merchandise;

Penalties - initiated 33,393 penalty cases and collected $33,097,808 related to penalty actions; and

Liquidated damages - issued 53,576 liquidated damages cases and collected a total of $21,146,942 in liquidated damage payments.

Textile enforcement. Ahern notes that the textile industry represents a triple focus for trade enforcement - it is a key component of free trade agreements, the China quotas, and 43% of all revenues collected by CBP are in the textile and wearing apparel industries. Over the last three years, CBP has visited over 2,000 foreign factory operations to ensure the correct country of origin. More than $25 million seizures have been made for goods misdescribed to evade quota and duty requirements. In 2005, 47 audits were performed on textile importers and an additional $4.97 million in lost revenue was recovered.

Approximately $1.3 million of textiles were seized in FY 2005. In FY 2006, the amount of seizures to date has exceeded $23 million. The commitments made to hire the additional personnel, as outlined in the FY 2002 Appropriations bill, have been fulfilled by CBP.

ITDS, FMCSA, USDA. According to Ahern, the Concept of Operations (CONOPS) has been briefed to four Participating Government Agencies (PGAs). These discussions are part of the process leading to the new PGA Memoranda of Understanding for ACE. Each CONOPS document outlines how the PGA intends to use ACE in the future and includes details on applicable interactions with CBP at the border. A series of follow-up meetings with some of the agencies to explore the specifics of the operational scenarios and explore common interests between agencies for the same commodity areas are planned. Coordination with the Federal Motor Carrier Safety Administration (FMCSA) continues and an agreement on the FMCSA data elements in the International Trade Data System (ITDS) Standard Data Set has been reached.

Ahern notes that ITDS has been part of the CBP team that examined the information needs of the CBP Agriculture Specialists in support of the "one face at the border" goal. The ITDS team determined that it would be possible to use existing data in the CBP Automated Commercial System (ACS), augmented with CBP's other targeting and recordation systems, to provide an automated process for the specialists to record the results of their work and provide the necessary data to the U.S. Department of Agriculture (USDA). It is the goal of the ITDS team to implement this new capability before the end of 2006.

See future issue of ITT for highlights of the written statement provided by Treasury's representative regarding ITDS, etc.

CBP statement available at http://finance.senate.gov/hearings/testimony/2005test/042606jatest.pdf.

All government, trade, and Committee statements available at http://finance.senate.gov/sitepages/hearing042606.htm.