After years of partnering with the private sector to transform the nation’s trade processes, U.S. Customs and Border Protection reached out to industry again at the agency’s East Coast Trade Symposium in Atlanta, Dec. 5-6.
“We’re looking to introduce a dialogue, to bring you into a conversation about how we move forward with our trade strategy,” said Acting CBP Commissioner Kevin K. McAleenan. “We want to talk about the next phase, how we keep up with really exciting changes in supply chains, technology and the ability to communicate globally.”
Acting Commissioner McAleenan assured the more than 700 attendees who gathered at the two-day event held at the Atlanta Marriott Marquis that CBP would continue to finish “the ambitious efforts that we’ve been collaborating on for the last several years. We’re going to get all of that done,” he said. “We want to be there at the forefront with you to make the U.S. border the most modern and efficient globally. We’re trying to challenge ourselves to make sure we’re not just focusing on the immediate objective, but also thinking about where we want to be going in three to five years and beyond.”
In the symposium’s opening keynote address, Brenda Smith, executive assistant commissioner of CBP’s Office of Trade, presented the goals and priorities of CBP’s trade strategy. “We recognize that our basic responsibilities remain the same—security, enforcement, and facilitation,” said Smith, who used the analogy of a four-lane highway to describe CBP’s strategy for the next few years.
The first lane, Smith explained, is comprised of “secure trade lanes” or CBP’s efforts to protect the country from threats posed by high-risk goods moving in and out of the U.S. The second lane focuses on “next generation facilitation,” which includes opportunities for deregulation and new business models.
The third lane is about “intelligent enforcement,” allowing CBP to integrate and apply information, authorities, and resources to enforce trade laws and regulations. “The information that we gather is a very powerful tool,” said Smith. “Analyzing that information more carefully with an eye toward predicting future violations and seeing where patterns exist will help us narrow in on those violating the law.”
Smith also highlighted CBP’s role in implementing the Trade Facilitation and Trade Enforcement Act of 2015, or TFTEA. “TFTEA and the recent executive orders have given us powerful, new authorities, which call on CBP to be more effective at going after fairly complex and often deeply hidden methods of illicit trade,” said Smith.
The fourth and final lane, “resource optimization,” is focused on getting the best value for taxpayers, which includes determining the level of resources needed and the willingness of stakeholders to invest in CBP. “We’ve done our homework,” said Smith. “We know that for every dollar invested in CBP’s trade personnel or technology, we return $87 to the U.S. economy, either through lowering the costs of trade, ensuring a level playing field for domestic industry, or protecting innovative intellectual property.”
Smith encouraged the attendees to bring their ideas forward. “What do we want the horizon to look like? Where do we want to be 10 to 20 years from now from the trade’s perspective?” she said.
Following Smith’s remarks, Acting Commissioner McAleenan participated in a one-on-one conversation with Geoff Powell, president of the National Customs Brokers and Forwarders Association of America. As part of the discussion, Acting Commissioner McAleenan shared some of his concerns. “We know that our adversaries have a continued interest in a spectacular attack against commercial aviation aircraft,” said McAleenan. “Our partners at TSA along with CBP at our National Targeting Center are very focused on identifying those threats and trying to address and inspect anything that we think is suspect on an aircraft.”
The opioid epidemic is another concern. “It’s very clear it’s a huge challenge around the country. Many states are suffering terribly, and it’s tied to direct consumer shipping, which allows for the spread of synthetic narcotics, especially opioids—fentanyl, carfentanil, and its analogs. That’s a threat that keeps me up at night,” said Acting Commissioner McAleenan. “How can we prevent that from entering the United States without slowing down the tremendous trade that’s been increased through e-commerce, the internet and direct consumer shipping?”
The symposium also featured notable speakers such as Homeland Security Deputy Secretary Elaine Duke, who gave her last public address as the Department’s acting secretary. Duke, the keynote luncheon speaker, told a crowded audience, “When we talk about threats to homeland security, we often talk about terrorism, about dangerous criminals, and unsecured borders. We talk about cybertheft and natural disasters. What we don’t often talk about is the threat in the medicine cabinet, on the kitchen counters, and underneath the Christmas tree all around America. I’m talking here about dangerous products—from tainted baby formula to counterfeit batteries that make their way through the supply chain and into the homes of American consumers,” said Duke, noting that import safety is bigger than any one agency or any one department. “We need your voice. We welcome your voice and your knowledge to keep the American people safe.”
Duke also explained that in addition to protecting U.S. consumers from harmful or unsafe imports, that DHS is also committed to helping end forced labor. “Forced labor is one of the most complex supply chain issues facing the global economy,” said Duke. “While not a new problem, it is one with moral implication for all of humanity. The news is full of stories about devastating conditions faced by people in forced labor including children. Whether they are kidnapped and sent out on fishing boats for months at a time, tricked into harvesting impossible quotas of coffee beans, or forced to work in sweat shops with dangerous conditions—forced labor is a form of modern day slavery,” she said, adding that “beyond the ethical considerations, forced labor creates an uneven playing field for businesses. How can an American business that pays its workers fair wages compete with a foreign business that profits from forced labor? That’s an area we’re focusing on in addition to others,” said Duke. “That is why I am dedicated to building a global enforcement network across the government enterprise to stamp out unfair trade practiced by forced and child labor.”
Partnerships with governments, other government agencies, and the private sector were highlighted in the symposium’s general sessions. One session on North American Collaboration for Cargo Processing highlighted joint cargo inspections at the U.S.-Mexico and U.S.-Canada borders. In 2014, CBP initiated joint cargo preclearance inspections at the facilities of the exporting country. In 2016, CBP implemented similar joint inspections known as “unified cargo processing” at the importing country’s facilities.
“The main goal of these programs is to avoid duplicate inspections. If we’re going to inspect cargo, let’s do it together, so we don’t have to unload and reload cargo and do the inspection on both sides of the border. Let’s do it in one place,” said José Martín García, the representative of the Ministry of Finance, Tax and Customs Administration, at the Embassy of Mexico, one of the program designers and a panelist. “It speeds up the process and saves a lot of time and money for companies. Some companies are telling us that they are saving 50 percent in terms of time and sometimes 60 percent in terms of cost,” said García. “For us, as customs authorities, there’s a savings in infrastructure, personnel, and better coordination. But not only that. In terms of compliance, it sends a strong message to the trade community that we’re working together, that we share information. So if you’re trying to cheat us, think again.”
Another general session focused on the evolution of trade and the challenges of e-commerce. According to CBP statistics, the number of parcels coming through the country at international mail and express courier facilities is growing exponentially. Approximately, 1.4 million parcels come into the U.S. daily. “To think that we’ll be able to interdict the threats in 1.4 million parcels that enter the country every day is not realistic,” said Todd Owen, executive assistant commissioner of CBP’s Office of Field Operations, who moderated the panel. “We need a new strategy. Interdiction alone is not going to be the solution to the threats and the challenge that we face in this arena.”
Panelists discussed ways to address the problem. Aside from interdicting shipments at the border, “we need to look at international efforts that take us back to the point of origin of where those cargo shipments begin,” said Owen. “We also need a strong response from our federal, state, and local enforcement communities to make sure we deliver consequences for those that deal with this illegal activity.”
Panelist Michael Walsh, CBP’s director of intellectual property rights and e-commerce, noted that a key part of the solution is “building strong partnerships and alliances with the private sector because they oftentimes will have information that we might not necessarily have.” Furthermore, Owen said, “consumers need to take more responsibility for their online buying decisions.”
The symposium also included a town hall-style meeting where CBP’s senior leadership shared significant accomplishments in support of the agency’s trade vision and strategy. “The passage of TFTEA was really a watershed moment for the agency in how we execute all of our missions,” said Smith. “If you really dig down in the legislation, it mentions every office at Customs and Border Protection. But from the trade perspective, there were 110 new requirements to execute, and many of those requirements weren’t just ‘send us a new report.’ They were a substantial shift in the way we did business.”
New advancements in nonintrusive inspection technology will similarly have a major impact on the efficiency of CBP’s cargo processing. “The new technologies that are coming out have high-low energy setting adjustments that will allow trucks at the land borders to keep moving as they go through the scanning process,” said Owen, explaining that typically trucks need to make a complete stop so that drivers can step out of their vehicles when they’re scanned. “We can’t scan the cab with high energy because it could potentially harm the driver, and we can’t scan the cargo with low energy because it would be completely ineffective,” he said.
With the new, adjustable nonintrusive inspection equipment, the system will remain in low energy as the cab of the truck passes through. Once the cab clears, the system will adjust to high energy to scan the truck’s cargo to look for anomalies. “This is going to allow us to increase our throughput,” said Owen. “With our current process, when the truck stops and the driver gets out, we’re able to scan about seven trucks an hour. But with the new technology, we’ll be able to scan 70 to 80 trucks an hour. So this is really going to be a significant improvement for us.”
A number of breakout sessions were held on the second day of the Trade Symposium. One of the most popular sessions was on TFTEA priorities. Panelists discussed a range of topics including responsible sourcing and reasonable care, the evolution of enforcement in antidumping and countervailing duty orders, and intellectual property rights. “A significant current challenge for CBP is the enforcement of intellectual property rights in an e-commerce environment,” said Alice Kipel, CBP’s executive director of regulations and rulings. “We need to figure out how to address and enforce against the sources of the problem, including the illicit enterprises funding sweatshops abroad. To that end, CBP has recently developed an intellectual property rights public education campaign to warn people about the dangers of counterfeit goods. We want each and every American to be an enforcer. We want everyone to understand that it is not okay to buy a fake, imported Rolex™ watch on the street in New York or in a back alley while on a vacation abroad,” she said.
Many who attended the symposium said they found it worthwhile. “With all the trade publications that get released, I can read all I like on e-commerce, but actually hearing professionals speak toward it really puts things into perspective,” said Alexandra Cohen, a senior trade compliance analyst at American toy and board game manufacturer, Hasbro, based in Pawtucket, Rhode Island.
Cohen came to the symposium hoping to learn more about the impact of e-commerce on the supply chain. “With the growth of digitalization and online shopping, it’s important to know where e-commerce fits into our business model to ship products to our customers in the most efficient way.”
For Sundra Glennon, the manager of international logistics at American bookseller Barnes & Noble, Inc., headquartered in New York, the symposium was an opportunity to hear information firsthand. “I enjoy coming to these events because I get direct access to Customs and Border Protection employees, our Centers of Excellence and Expertise, and an opportunity to network and share information with other importers.” Glennon was especially interested to learn about what’s new in compliance. “With the new administration, I wanted to hear some of the new policies and the vision going forward, said Glennon. “We want to be a good partner to CBP and continue what we’ve had in the past.”
Carie Samuel, chief compliance officer at brokerage firm Marisol International based in Springfield, Missouri, is an industry veteran who has attended several Trade Symposiums. “As the compliance officer, it’s my job to keep abreast of the regulations to see what’s coming down the pike, to pass that information on to our other offices,” said Samuel.
Over the years, Samuel has watched CBP evolve. “In 27 years, I’ve seen a big shift. The communication between customs and trade is so much better. I think people like Brenda Smith are vital in encouraging that conversation. That’s one of the reasons I like to come to this event,” said Samuel. “It’s not someone from the government standing up and saying, ‘This is the way it’s going to be.’ Today, it’s a conversation about how CBP can do things to help trade, and yet at the end of the day take care of enforcement and the revenue of the country.”