EMMETT EXPECTS BALANCE BETWEEN COMMERCIAL, SECURITY REQUIREMENTS

EMMETT EXPECTS BALANCE BETWEEN COMMERCIAL, SECURITY REQUIREMENTS    Enhanced security requirements in place or due to be introduced by the U.S. government and Congress will allow a balance between the requirements of security and commerce, said Edward Emmett, president of the National Industrial Transportation League.
   “The league believes that a fair balance may be achieved where the system can be made less vulnerable to terrorism while delays can be kept to a minimum,” Emmett told the Shipper Forum 2002 in Athens, Greece. “While this may take some time, because of all of the programs that are underway or soon will be, the possibility that the marine transportation system will be used as a tool for terrorists should be reduced.”
   Emmett referred to “a dizzying array” of security initiatives that are taking place in both the executive and legislative branches of government.
   “In considering all these measures, shippers must keep in mind that the consequences that would result from terrorist activities would include interrupted vessel service, port closures and indefinite delays to cargo,” he said. “Government and industry leaders must work together in fashioning procedures that will be effective without impeding commerce.”
   Emmett said more than 400 shippers have joined the Customs-Trade Partnership Against Terrorism Program, the 'known shipper' program introduced by U.S. Customs in April.
   “Clearly the C-TPAT is a viable program that should facilitate cargo flows,” he said. “It also has the advantage of increasing the visibility of shipments to the appropriate parties, so that anomalies may be easily detected.” If authorities are familiar with the parties, their operations, practices, use of suppliers, and service providers, then their cargo will be considered a 'low risk' and proceed without undue delay, he explained.
   Emmett believes that smaller unknown shippers outside the C-TPAT program may face some problems under the new security regime.
   On the proposed 24-hour manifest prior transmission rule published by U.S. Customs, Emmett said some in the industry have reacted with criticism.
   “Compliance with the proposed rule will definitely change how the transportation industry moves freight and that will require more planning, different logistics strategies and greater cooperation with other sectors of the industry,” he said. “Not surprising many of the comments in reaction to the rule have centered on its negative implications ' port and terminal congestion, longer transit times and service failures. However, the alternative results in the event of a terrorist attack have even graver consequences.”
   The rationale for the proposed manifest transmission rule is that “last-minute or late-booked cargo may pose a risk to the ship, crew or facilities which the vessel uses,' Emmett said. In the NIT League's response to the proposed rule, it recognized the importance of the proposed rule, and urged U.S. Customs “to phase in its requirements, recognize that clarifications are needed in several areas and that provisions be made for foreign suppliers which may not have access to electronic communications to transmit cargo manifests,” he said. The NIT League also asked that bulk cargo be excluded from the rule because illegal items cannot be concealed in such cargo and then directed to a specific destination.
   Emmett stressed that the Trade Authorization Act of 2002, approved by Congress in August, “is the first major law approved in the U.S. implementing new security requirements on the movement of freight.”
   This new law provides for security requirements on U.S. imports and exports, including new documentation and reporting rules.
   “While the new law would permit the president to negotiate trade agreements, the measure will also affect ocean cargo movements.” Emmett said.
   Under the law, no shipper of cargo (including transportation intermediaries) may tender, or cause to be tendered, cargo that is not properly documented. “If these requirements are not met, the new law provides significant penalties, including seizure of undocumented cargo, civil penalties in the amount of the value of the cargo, or the actual cost of the transportation, whichever is greater,” Emmett warned.
   For imported cargo (affecting air, maritime and surface modes), the act requires the Secretary of Treasury within one year to promulgate regulations providing for the electronic transmission of shipping data on cargo to the Customs Service.
   “Specifically, through a rulemaking, the secretary shall solicit comments from a broad range of parties likely to be affected by the regulations, including, importers, exporters, carriers, customs brokers and freight forwarders,” Emmett said.
   “As was the case in the U.S. air system which faced a three-day shutdown after Sept. 11, 2001, a terrorist event involving ocean freight transportation, according to many experts, might result in an operational shutdown for several months,” he added.