CBP Commissioner's Recent Remarks on Container Security Device Requirements, 10+2, SFI, 100% Scanning, C-TPAT (Full Summary)

This Full Summary combines into one document BP summaries Parts I-II which highlight CBP Commissioner Basham's remarks. See ITT's Online Archives or 07/17/07 and 07/18/07 news, 07071705 and 07071810, for Parts I and II, respectively.)

Container Security Devices

CSDs to be Vital Link, But Perfect Technology Probably a Long Way Off

According to Basham, the CSD capability would be the vital link that would close the loop between Customs-Trade Partnership Against Terrorism (C-TPAT) supply chain security at the point of stuffing, information-based risk assessment, and secure ports; however, the perfect CSD technology is probably a long way off and may prove to be far too expensive.

Basham stated that CBP is currently working with the Department of Homeland Security's (DHS') Science and Technology Directorate to determine the technical and administrative requirements for the CSD.

(CBP's original vision was for CSDs to senda signal when the container's door had been opened or breached in transit that could be read by CBP with either a fixed or handheld reader. The signal would tell CBP which containers pose a potential security issue, warranting an inspection.)

CSD Requirements Expected Soon, 60 - 90 Day Test Period to Follow

Commissioner Basham stated that he expects to set forth CBP's requirements for CSDs soon. Shortly thereafter, CBP expects to test CSD technology to see if available technology meets CBP's requirements. Basham states that CBP intends to move quickly and that the testing phase would be completed within about 60 to 90 days, after which CBP intends to promptly evaluate the results.

Basham also noted that he is confident that CBP will be able to handle what likely will be less than 1 or 2 percent false positives from CSDs.

CSDs That Meet CBP's Requirements to Become Part of C-TPAT

According to Commissioner Basham, the use of CSDs, if they meet CBP's requirements, will become part of the C-TPAT program and, at a minimum, should be viewed as a C-TPAT best practice.

Also emphasized by Commissioner Basham is the fact that CSDs will move CBP one step closer to realizing the "Green Lane," as there can be no "Green Lane" without CSDs.

Use of Simple CSDs on a Voluntary Basis Would Avoid Uncertainty, Delays

Commissioner Basham notes that the beauty of CBP's CSD system will be its voluntary nature - companies can choose the relatively small cost of simple CSDs, approved by CBP, that will lead to faster, more predictable customs processing, or they can choose the cost of less predictable customs clearances and potential delays.

(Basham opines that CSD manufacturers will have an incentive to keep the price low, as companies will not be required to use the devices.)

10+2, SFI, 100% Scanning, C-TPAT

CBP Plans to "Phase In" the 10+2 Advance Data Requirements for Maritime Cargo

Basham states that CBP has developed a draft proposed rule containing its proposed security filing (SF, 10+2) requirements for 10 additional data elements from importers 24 hours prior to foreign lading, and for 2 additional data sets from ocean carriers, for imported maritime cargo.

This draft has been sent to the Department of Homeland Security (DHS) for its review and comment.

Like the Trade Act of 2002, and many of the new security measures CBP has implemented over the past five years, Basham states that 10+2 will be phased in. With the new reporting requirements, CBP will continue to work with the trade to make sure all issues are resolved before it goes to full compliance.

(See ITT's Online Archives or 05/31/07 news, 07053105, where trade sources indicated that the proposed rule was expected by fall 2007, with the final rule likely to be "fully implemented" by the end of 2008.)

CBP is Implementing SFI, the Next Generation of CSI

The Container Security Initiative (CSI) will soon be deployed in 58 foreign ports, which will cover 85% of the maritime containerized cargo coming to the U.S. Basham notes that CBP is now implementing the next generation of CSI - the SFI - which integrates radiation detection and container imaging.

Basham states that SFI will meet the Security and Accountability for Every (SAFE) Port Act requirement to conduct an overseas integrated scanning pilot program and will be fully deployed in three ports around the world - Port Qasim, Pakistan; Port Cortes, Honduras; and Southampton, United Kingdom, with some limited capacity in certain additional ports.

(See ITT's Online Archives or 05/14/07 news, 07051415, for BP summary on the beginning of official SFI data transmissions from Port Qasim in April 2007.)

CBP Thinks 100% Scanning Concept Being Considered by Congress is Flawed

With regards to discussions underway in Congress about 100% scanning², Basham stated that CBP believes that the concept is fundamentally flawed.

According to Basham, CBP's SFI pilot will give CBP information on the technical feasibility of 100% scanning, the impact on supply chains, the security gains, if any, and the costs to both the public and private sectors.

Basham also expressed concern about the credibility of the U.S. with its international partners, as mandating 100% scanning prior to concluding the first phase of the SFI pilot will undermine the credibility of CBP's current efforts.

C-TPAT

According to Basham, C-TPAT's more than 7,000 members account for 45% of imports into the U.S. and in the next few years, C-TPAT will evolve even further to respond to the widespread demand for participation.

Basham notes that CBP has validated 78% of C-TPAT certified partners and expects to have validated 100% by the end of 2007.

Basham also stated that CBP will continue to pursue mutual recognition between C-TPAT and foreign business partnership programs through the World Customs Organization (WCO) Framework. Basham notes that CBP has signed the first Mutual Recognition Agreement with New Zealand and is actively engaged with Jordan and the European Union (EU) in developing a mutual recognition regime. Japan and Canada have also expressed interest in the concept, according to Basham.

(See ITT's Online Archives or 07/03/07 news, 07070305, for BP summary on CBP's selection of ten validators for the C-TPAT third party validation pilot in China.

See ITT's Online Archives or 07/16/07 news, 07071615, for recent BP summary regarding the U.S.-New Zealand arrangement on global trade that could result in mutual recognition of supply chain programs.)

¹CSDs were also referred to as "Smart Boxes" by the Commissioner.

²The House version oflegislation to require overseas scanning of 100% of ocean containers bound for the U.S.within three or five years (H.R. 1) is currently the subject of a House-Senate conference to resolve issues between the House and Senate versions of the bill. (See ITT's Online Archives or 01/11/07 news, 07011110, for BP summary on House passage of H.R. 1.)

Commissioner Basham's remarks (dated 07/11/07) available at http://www.cbp.gov/xp/cgov/newsroom/commissioner/speeches_statements/commish_remarks_csc.xml.