CBP Considering Giving Filers Choice on Blockchain Adoption in ACE 2.0, Software Developer Says
TUCSON, Arizona -- CBP is considering giving filers the option of using blockchain technology for entry filing as it develops ACE 2.0, Celeste Catano of E2open said May 4 at the National Customs Brokers & Forwarders Association of America annual conference. Filers would have the choice between setting up a distributed ledger to talk to CBP’s distributed ledger, or use ABI calls to CBP’s system, she said.
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“Unfortunately, we don’t know what the answers really are yet, but at least they’re looking at options, and not forcing everybody into this technology at this point,” Catano said. Earlier moves by CBP toward requiring blockchain in ACE 2.0 had generated angst in brokers over the size of the investment and effort necessary for implementation, she said.
CBP is looking for the “end-to-end visibility” and traceability for the whole supply chain that blockchain would give the agency, Catano said. “They’re looking to get data early on in the process. They’re looking to get data from manufacturers, online retailers, sellers, anybody that touches anything, anybody with an intent to import into the U.S. they want to get data from.” Discussions are in very early stages, with no idea “how they’re going to get this, who they’re going to get it from; that’s all still being talked about.”
CBP is working on five pilots to test blockchain, on pipeline oil, steel imports, pipeline gas, food safety and e-commerce, Catano said. CBP is talking about starting “integration” for pilots on pipeline oil, steel and e-commerce in 2022, with an eye to putting them in the production environment in 2024. “So that’s still quite a ways out, and those are fairly narrow product sets at this point.” CBP is looking to put its pipeline gas and food safety pilots into the production environment in 2025.
“And of course, those are just the pilots, not anything with the full ACE 2.0 functionality,” Catano said. “We’re still a few years off for that type of functionality.”
Blockchain is already in use to track food supply chains among major food producers and retailers, as well as in the financial industry, but implementation is still expensive at this point, Catano said. “Hopefully by the time we have to get on board to start using it with Customs, the technology and the price of the technology will be better, because right now, at least initially, the cost of going to blockchain for those products was still pretty high. The entry into blockchain was still a pretty substantial sum at this point,” she said.
If CBP adopts blockchain, customs brokers likely will not see their roles change much, said Tom Gould of Flexport, who spoke during the same panel discussion. Rather, customs brokers will probably have one additional duty, that of putting data onto the blockchain, on top of their current roles, he said.
“If you look at the future with ACE 2.0, assuming Customs implements the digital ledger technology, and uses blockchain to store the hashes to store the information, to verify the documents that we’re dealing with, we’re still going to gather the data,” Gould said. “We’re still going to gather the documents, whether we're going to analyze that data the same that we do today. We’re going to add the classification number, if that’s what we do. We’re going to be able maintain the records.”
“But one extra step that I see Customs asking us as brokers to do with parts of our data is to take the data that we have, and as a way of providing proof to Customs that the data is accurate and hasn’t changed at any point in time, is we’re going to create a hash of the various documents, the various datasets that we have and we are going to store that in a blockchain and distributed ledger somewhere,” Gould said. Brokers will put a hash on the blockchain, but they will also still file a declaration as they do today, he said.