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E-commerce supply chain keeps U.S. Customs and Border Protection leaders awake at night

Customs and Border Protection will ramp up technology to give the agency’s front-line officers better insight into which small package imports to target

Senior officials at U.S. Customs and Border Protection (CBP) said what “keeps them awake at night” is knowing there are small packages potentially concealing dangerous narcotics and other unsafe products that are slipping past the agency’s oversight in the burgeoning e-commerce supply chain.  

“Make no mistake, this is an urgent matter,” CBP Deputy Commissioner Robert Perez told attendees at the agency’s trade symposium in Chicago on July 24. “People are dying out there” from synthetic opioids arriving in small package imports.   

“It’s really the biggest change that we’ve seen in the last 10 to 15 years,” said Brenda Smith, executive assistant commissioner for CBP’s Office of Trade.

In March 2018, CBP initiated a technology- and data-driven strategy to enhance its oversight of e-commerce imports, including seeking industry input through the Commercial Customs Operations Advisory Committee (COAC) and express carrier industry. Smith said this work has put the agency on “a pretty good path of wrapping our arms around the e-commerce issue.”

Internationally, CBP continues to work with its counterparts at the Brussels-based World Customs Organization to refine the June 2018 Framework of Standards on Cross-border E-commerce. The framework is intended for customs administrations seeking to establish legislation and operations for cross-border e-commerce oversight.

In addition to dangerous opioids, such as fentanyl, CBP officers at the nation’s international mailing centers are encountering myriad illicit products in e-commerce packages. 

Robert White, director of field operations in CBP’s Chicago Field Office, told trade symposium attendees that his officers have found small package imports arriving at Chicago’s international mail center that contain intellectual property rights infringements, counterfeit medicines and machines to manufacture false identifications, which he added are “mostly from Asia.”

Todd Owen, executive assistant commissioner for CBP’s Office of Field Operations, said officers are finding potentially dangerous agricultural products in small packages. “These bad actors in the agricultural sector are no better than the fentanyl shippers,” he said.

The increasing volumes of small package e-commerce imports came after Congress passed the 2015 Trade Facilitation and Trade Enforcement Act (TFTEA), which raised the de minimis value for individual shipments to $800 from $200. 

CBP estimates that U.S. international mail processing facilities now handle more than 1.8 million packages per day with declared values of less than $800, with that volume expected to increase in the years ahead. 

Similarly, the agency has noted an increase in trucks crossing the Canadian and Mexican borders into the U.S. with trailers containing thousands of small individual e-commerce shipments with declared values below the $800 de minimis.

On July 23, CBP announced an e-commerce shipment data pilot, which is scheduled to start Aug. 22. Nine participants will be picked from among e-commerce carriers, customs brokers, freight forwarders and online marketplaces. During the pilot, these participants will electronically transmit certain data elements related to their shipments CBP in advance of arrival in the U.S. 

The goal for the pilot is to give CBP a better understanding e-commerce transactions and knowledge of what’s in these packages, Smith said.

“We’re going to try to get this right,” Perez said, noting that the growth of e-commerce is a positive economic driver in the U.S. “It’s not in CBP’s DNA to slow things down.”

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Chris Gillis

Located in the Washington, D.C. area, Chris Gillis primarily reports on regulatory and legislative topics that impact cross-border trade. He joined American Shipper in 1994, shortly after graduating from Mount St. Mary’s College in Emmitsburg, Md., with a degree in international business and economics.

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