Combined C-TPAT/ISA Trusted Trader Program Will Allow for More Company-Specific Vetting, Says CBP's Neuhart

The proposed framework for the new program includes using the industry specific Centers of Excellence and Expertise to manage trusted trader accounts, said Neuhart. The program will also recognize “specified risk assessment and internal controls” to show an understanding that all participants aren’t the same and there’s no “cookie cutter solution” to vetting the applicants, she said. That means the companies may need to demonstrate to CBP their internal controls, accounting methods, and trade compliance practices. CBP will deploy the program in three six-month phases, she said.

The program will also allow the agency to work “even closer” with partner government agencies (PGAs) to better make use of other trusted trader programs, said Neuhart. The hope is that the partnership would allow for enhanced information sharing and adding in the requirements of other agency programs. So far, only the Consumer Product Safety Commission is officially engaged, but two others, which Neuhart declined to name, have been involved.

CBP has worked with a trusted trader working group to develop the framework, said Diane DeJarnett, Customs and Trade Compliance Manager at Toyota Motor Sales. The group worked to come up with some incentives, for the short-term, medium-term and long-term, she said. For instance, some potential perks of participation in the first phase may include retroactive flagging for the four reconcilable flag types and exemptions from non-intrusive inspections, unless there’s a major concern.

CBP plans to begin vetting of applicants to the program within 30 days of receipt of the application and look at:

• Enforcement risks
• Compliance history
• Prior audits
• Documented system of internal controls
• Financial reviews
• Corporate history, structure, and ownership

CBP will likely require participants to be already C-TPAT certified. Current plans for the program won’t include tiered statuses, as C-TPAT does now, but that does not mean it won’t ever happen, said Neuhart.

The integrated supply chain security components of C-TPAT and trade compliance pieces of ISA program will allow for efficiencies for both industry and CBP, she said. That will allow CBP to focus its resources on higher risk importers, she said. As a result of the new program, CBP will be able to offer additional incentives to importers that the agency deems low-risk, while also reducing the costs and time involved with applying and vetting, said Neuhart.

Management of the program will move from the Office of International Trade, which now oversees the ISA program, to the Office of Field Operations, where C-TPAT is managed, she said. The program, at least initially, will only include importers, but the agency may consider other participants later on, she said. The agency is also considering the inclusion of Non-Resident Importers that have an affiliated business unit staffed and operating in the U.S. or Canada.

C-TPAT won’t be going away as a result of the new program and companies will continue to be able to participate solely in C-TPAT if they prefer, she said. “We will continue to support and honor the C-TPAT incentives as well as the ISA incentives … but we want to ensure and establish certain levels of trade compliance validations that are a little bit different than what the ISA partnership participant might see today,” she said. CBP is hoping to select the Trusted Trader applicants within the “October timeframe” said Neuhart. The agency is now working on getting together some necessary details before a Federal Register notice is posted, she said. CBP has been discussing combining the two programs for over a year (see 12051809) and previously said it hoped to begin the pilot this month (see 13052032).

Email ITTNews@warren-news.com for a copy of the slides shown as part of the Webinar.