Remarks as prepared for September 28, 2015
Thank you, Geoff, for that warm welcome. I’d also like to thank the association’s Executive Vice President Barbara Reilly, as well as the NCBFAA Board of Directors, officers, and members.
I also want to congratulate NCBFAA for being recognized by CBP’s Field Operations Academy for your 10-year partnership in support of the Basic Trade Training Programs in Charleston, South Carolina. Your technical expertise is invaluable, and the more than 40 training sessions you have provided during the past decade have reached nearly 1,000 students.
I’m pleased to be here today to provide an update on CBP and to express my gratitude to the brokerage and freight-forwarding community for working with us to facilitate global trade while maintaining secure and efficient borders. I know there’s a lot of ground you’re covering here today and tomorrow.
Earlier today you heard from Cynthia Whittenburg about ACE and Single Window. And tomorrow morning, Assistant Commissioner Brenda Smith, will walk you through the vision for the broker profession. My goal is to update you on CBP’s trade vision, and emphasize the vital role the broker community plays in that vision.
First, let’s take a look at some statistics – and I have to offer a disclaimer here because, as a government official, I’m guess I’m obliged to “dazzle you with data.” But these numbers really hammer home the enormity of what’s at stake in terms of our economic growth.
The U.S. has grown from $2.3 trillion in imports in 2011 to $2.5 trillion in 2014. Likewise, the number of entries filed has increased from 29.5 million entries in 2011 to 31.6 million in 2014. Revenue collections are also up, rising from over $37 billion in 2011 to nearly $44 billion last year.
There are a couple more numbers I need to share – and these are key. More than 90 percent of all import transactions in this country are filed through a broker. There are more than 17,600 brokers registered with CBP – 13,000 classified as active – each playing a pivotal role in helping CBP facilitate the entry, clearance, and movement of cargo – activities that are essential to our Nation’s economic health.
This brings me to the Automated Commercial Environment (ACE) and the “Single Window” – this is the major development in how you and your customers interact with the U.S. government. We are building systems to replace the outdated, redundant, paper-laden processes that have existed across the government.
Thanks to the hard work of our industry partners like you, as well as numerous agencies across the Federal government, we are on track to deliver the International Trade Data System through ACE by the President’s December 2016 goal. We know that it’s been a tough transition – but I can assure you that the return on your investment in this change will be well worth it.
More than 85 percent of Single Window capabilities have been deployed, and by the end of October, the majority of PGA capabilities will be deployed at ports across the nation.
We have heard from many industry partners, trade associations, and our Commercial Operations Advisory Committee (COAC), about the need for industry to have more time to update systems before the ACE becomes mandatory. We heard you, and on November 1, we begin the transition to make ACE the single system for the filing of all data needed for the release of cargo, as well as entry summary, and we will continue this transition through two milestones – one in February 2016 and the other in July 2016.
The Automated Commercial System (ACS) will no longer be available for as of February 28, 2016, and we expect the industry to be using ACE to file entries and entry summary data for CBP, FDA, NHTSA, and APHIS (Lacey Act) data. To better prepare for this milestone, I encourage you to begin using ACE as soon as possible to file the most common import transactions.
Brenda Smith is going to cover a lot of this ground tomorrow, but I specifically want to encourage your participation in the PGA Pilots, started on August 19, that allow us to test PGA capabilities and prepare our field resources for the changes ahead. This type of testing and early adoption is precisely what we need to make this transition successful.
CBP is actively contacting each of the top 200 filers, along with smaller, local filers, to assist with the transition to ACE. We are also using the Border Interagency Executive Council, along with joint webinars with our agency partners, to conduct regular outreach to industry. But we recognize that the complexity of the import process requires a knowledgeable, licensed agent to advise clients and ensure compliance.
CBP’s vision for the future Professional Broker is one that includes adapting to technology changes, maintaining expertise in compliance, while balancing responsibilities to clients and the law. Future changes include removing district boundaries, creating opportunities for brokers to leverage automation, expand your geographic reach, and increase your level of service and professional value.
CBP’s Centers for Excellence and Expertise are transforming the way CBP operates and interacts with the trade community. Thanks to your participation, we continue to make real progress.
The 10 Centers align our processes with modern business practices, focusing on industry-specific issues and providing tailored support to unique trading environments. We established the Centers in 2013 to increase uniformity across our ports of entry, facilitate the timely resolution of trade compliance issues nationwide, and further strengthen our knowledge about industry practices.
Three of the Centers are fully operational now, and the other seven are all coming on line within the coming year, and my Assistant Commissioner for Field Operations, Todd Owen, is spearheading this quick and effective expansion. These Centers are not only improving our operations and service to industry, but they also provide us opportunities to improve enforcement, allowing for more focused expertise to more proactively and effectively identify noncompliance and violations, and ultimately safeguard the supply chain.
We are counting on you, as brokers, to make sure that importers know that their transactions will now be handled by a Center. Your help is critical in smoothing the transition to this new, more efficient way of doing business.
I’ve mentioned before the 2013 World Economic Forum finding that if every country improved just two key supply chain barriers—such as customs clearance delays, lack of standardized procedures or poor infrastructure—global trade could increase by $1.6 trillion, or nearly 15 percent. I know that CBP can make a precisely these types of improvements.
First, a word about our Trusted Trader Pilot, which involves nine importers – from industries ranging from electronics to automotive to pharmaceuticals – who volunteered to participate. As the trade compliance validations for these participants are completed, CBP’s Office of Field Operations is analyzing the procedures and outcomes to identify best practices and to develop internal guidance to strengthen the process. CBP’s Customs-Trade Partnership Against Terrorism (C-TPAT), is working with our foreign counterparts to make sure that Trusted Traders reap the benefits of earning that trust.
Mutual Recognition Arrangements – in which CBP and other customs administrations recognize each other’s supply chain security programs – result in more efficiency, less redundancy, improved risk assessment, and lower risk for trusted traders. These agreements take time, effort, and resources to implement, and the United States has now signed 10 MRAs. In addition, there are currently 53 operational Authorized Economic Operator programs, with 10 more in the works.
We count on you to educate and encourage customers to embrace the supply chain security tenets and goals of C-TPAT. And I commit to regularly evaluating our existing MRAs to make sure our partners in these agreements are upholding their pledges around both security and efficiency.
NCBFAA plays a vital role in helping us achieve our mission of facilitating trade while protecting the public and economy from harm. All of you are integral to CBP’s trade mission – and absolutely essential in our relationship with American businesses.
Thank you, and now I’d like to take a few questions.