When the members of the Advisory Committee on Commercial Operations of Customs and Border Protection, otherwise known as COAC, gathered on Nov. 15 for their last public meeting of the year, they reported that they were continuing to make substantial progress.
The meeting at the U.S. International Trade Commission in Washington, D.C., was co-chaired by CBP Acting Commissioner Thomas S. Winkowski and Jeremy Baskin, senior advisor to the deputy assistant secretary of tax, trade, and tariff policy for the Department of the Treasury.
In his opening remarks, Winkowski acknowledged that 2013 had been a highly productive year for the advisory committee. The COAC’s six subcommittees had worked on a number of transformative issues and were planning recommendations on key trade areas including exports, the One U.S. Government at the Border initiative, and CBP’s automated cargo processing system known as ACE.
Winkowski announced that by year-end a Federal Register notice would be published soliciting importers to participate in a trusted trader pilot, which will unify CBP’s Customs-Trade Partnership Against Terrorism, known as C-TPAT, and the Importer Self-Assessment programs into one process. Phase I will be limited to nine volunteers and will be evaluated after six months on its effectiveness, cost savings, and lessons learned. “The trusted trader program is a key piece of our trade transformation efforts,” said Winkowski.
On the Role of the Broker initiative, participants addressed how to establish the factual identity of the importer of record and the means of proof, or “bona fides,” required to confirm that identity. At the meeting, four recommendations were presented to the COAC and were passed.
“I want to thank the COAC for struggling with this idea of bona fides. It’s important work to continue,” said Lev Kubiak, the director of the National Intellectual Property Rights Center, which is managed by U.S. Immigration and Customs Enforcement. “We see a continually growing threat. Our ability to protect the United States economy and the safety of U.S. consumers is hampered by this growing prevalence of importer identity theft, shell corporations that don’t really exist, and importers that are totally offshore. Anything you can do to creatively help us press this issue will go a long way.”
Some of the COAC members shared their experiences with the Centers of Excellence and Expertise to illustrate how effectively they’re working. “Target was the first importer in the consumer products and mass merchandizing center,” said Ted Sherman, director of global trade services for Target Corp. and one of the advisory committee’s industry co-chairs. “I know that ‘bi-directional education’ is an overused term, but we really have seen that. There’s been a tremendous amount of education back and forth. We’re educating CBP on how our retail supply chain works. And they’ve given us a better understanding of customs processes. As a result of the center, we’ve seen a tangible, dramatic reduction in the cycle times associated with post entry work,” he said.
The COAC members also discussed the Export Survey results. The survey’s main finding “was that the majority of exporters and related brokers are small-and medium-sized enterprises,” said Julie Ann Parks, a COAC member who is the senior manager for export/import operations at the Raytheon Company.
Parks noted that three surveys were actually issued, focusing on exporters, freight forwarders/brokers, and carriers. One of the most insightful statistics was from a freight forwarder/broker perspective. “The biggest take-away, I think, out of all of this is the statistic about 43 percent of respondents indicating that an outbound exam costs $300 to $2,100 on average,” said Vincent Iacopella, a COAC member and the chief operating officer of the Janel Group, a global provider of integrated logistics services. “Our ultimate goal is to lower that transaction cost. The lower the transaction costs for exports, the more competitive U.S. exports are globally,” he said.
Results from the Trade Efficiency Survey were equally eye-opening. More than 81 percent of the respondents were satisfied with CBP’s trade facilitation efforts. Regarding costs and holds, 77 percent of survey respondents experienced exams. However, these exams impacted less than .25 percent of entries. When exams did occur, the impacts were substantial. “The average cost was upwards of $1,800 and averaged one to four days in delays,” said Parks.
Winkowski weighed in on the matter. “We all know we have to inspect, but we have to make sure that we’re doing the right inspections for the right reasons.”
The next COAC meeting is scheduled to be held in Washington, D.C., on Feb. 20, 2014.