EU 24-hour rule should include NVOs, Koch says

EU 24-hour rule should include NVOs, Koch says    Christopher Koch, the top U.S. representative for container vessel lines, on Tuesday called on importers and the European Union to help close existing or potential loopholes in cargo security.
   The president of the World Shipping Council encouraged importers to assist U.S. Customs and Border Protection in implementing a program to collect more data about commercial transactions with foreign suppliers and transportation providers to preserve the risk-based targeting approach as an alternative to more draconian inspection of all international containers.
   CBP primarily relies on the ocean carrier manifest to assess whether a shipment is legitimate, but the carrier document is flawed because it doesn’t contain information about the original parties involved in the transaction that could have outsourced the booking to a freight consolidator.
   The Department of Homeland Security agency is developing a plan to collect 10 additional elements from importers to help it identify the buyer, seller and container handler and run that information through it’s automated intelligence system to weed out potential terrorist smuggling threats. The agency still must determine what Customs information system will be used and which parties in the process will submit the shipment data.
   The credibility of CBP’s strategy, which is supported by the import-export industry, requires that it improve the quality of the data going into the targeting system, Koch emphasized.
   “If the trade community wants the government to allow its imports to face little delay in (the event of a terrorist incident involving containers), it should make a priority of determining how to provide the government with the additional data it will need to be confident of the security of the cargo shipments” so it can reopen ports to trade, Koch said in prepared remarks for the Maritime Security Expo in New York.
   Koch said he hopes the requirement of advance commercial data elements becomes a reality in 2007.
   The head of the Washington-based World Shipping Council expressed frustration with European Commission efforts to implement a measure similar to CBP’s advance manifest requirement for carriers to submit their container inventory list 24 hours prior to loading a vessel.
   The commission is developing regulations to implement a mandate for advance filing of container manifests as part of a risk-based cargo screening system.
   The EC proposal is flawed, Koch said, because it exempts freight forwarders who issue their own bill of lading, through their non-vessel-operating common carriers, from filing an advance manifest for shipments under their control, as is required by the United States.
   Such an exemption leaves a huge intelligence hole and is unfair to ocean carriers and shippers, Koch said. The draft proposal means that EU customs officers would have little knowledge of the underlying shipper or consignee, only the middleman.
   It is “probably not worth creating such a program in the first place because it wouldn’t accomplish anything,” Koch said from the floor. He characterized such a measure as “an empty exercise” that would have no security value but would increase costs for industry and customs authorities.
   Koch complained that the EC has rejected recommendations from the WSC, the European Community Shipowners Association, the European Shippers Council, and other transport-related groups, to require freight forwarders to prefile manifests just as ocean carriers are obligated to do. The EC’s response so far has been that such a requirement would add complexity to the process, he said.
   “This, however, is not very convincing. Customs authorities are responsible for reviewing and processing customs entry of thousands of shipments on every arriving vessel. It hardly seems plausible that these same authorities could not establish an automated system that could accommodate the filing of freight forwarders’ summary declarations,” he said in the prepared speech.
   Although customs authorities are moving beyond reliance on the manifest as the lynchpin of cargo data analysis, “it is unarguable that a system that excludes bill of lading information for shipments controlled by freight forwarders-NVOs would be wholly inadequate and ineffective as a security risk assessment tool,” Koch said.
   “Without a filing obligation by freight forwarders, any shipper could easily avoid advance screening of its shipment by simply contracting for transportation services with a forwarder instead of an ocean carrier.
   “If governments want to build meaningful pre-vessel loading security screening systems, that is an objective that the liner shipping industry can support. But all appropriate parties should play a proper role in such a system,” he said.
   Similarly, well-thought out DHS and CBP cargo security programs, such as advance data or pilot programs to test new technology that can X-ray 100 percent of containers without delay, also deserve industry support, he added.