Forwarders divided over screening policy
Feb. 1 marked the kickoff of a new U.S. security regime in which half of cargo aboard passenger aircraft must now be screened by the private sector.
The transition went smoothly by all accounts, but airlines are adding fees to cover their inspection costs, and freight intermediaries that arrange shipments with airlines for their customers are adjusting to the extra compliance burden they face. Some freight forwarders feel threatened by the requirements and are lobbying for the government to take the same responsibility for checking cargo as passengers.
The centerpiece of the Transportation Security Administration's strategy is a Certified Cargo Screening Program (CCSP) designed to relieve pressure on airlines by encouraging shippers, logistics providers, freight forwarders and other cargo handlers to screen cargo before it gets to the airport. Under the voluntary program, shippers who meet TSA criteria are approved to verify that each shipment at the piece level was securely packed and sealed. Forwarders have authority to deconsolidate large shipments and inspect each carton by physical or technical means before repacking the goods for secure transport to the airline ramp. The TSA must audit and certify that each facility seeking to participate in the program meets established security criteria.
The agency has also recruited 14 large freight forwarders to use scanning and explosive trace detection equipment to gather data on which systems are effective.
The TSA plans to meet the 50 percent screening requirement through a combination of those two initiatives plus a requirement that airlines screen 100 percent of cargo on narrow-body planes.
The CCSP is targeted at inspecting cargo that moves on large aircraft to domestic and international destinations. Under the interim requirement, at least half of the pieces in each shipment tendered to an airline must be checked.
The next goal line mandated by Congress is to screen all cargo on passenger planes by August 2010. The 50 percent threshold was relatively easy to achieve because narrow-body flights, although representing 96 percent of all U.S.-launched flights, only account for a quarter of the cargo. Plus, much of the cargo is already covered under the scan-all requirement for narrow-body planes that began on Oct. 1.
Now comes the tough part, said Brandon Fried, executive director of the Airforwarders Association. The remaining 4 percent of widebody flights handle 75 percent of all domestic originating cargo.
'The challenges will increase exponentially by virtue of the lack of technology to screen pallets and containers,' Fried said.
The TSA has yet to certify a piece of machinery that can scan pallets or unit load devices, especially for consolidated shipments that are not uniform in contents or shape. Breaking shipments down to the piece level at much higher volumes could significantly slow down cargo handling, industry practitioners warn.
The agency is certifying indirect air carrier and independent cargo screening facilities, as well as shippers.
The independent cargo screening facilities are available for companies that want to outsource their screening functions but don't want shipments to sit until airlines can do the job.
Approved shippers can screen their cargo as it is being packed and avoid any downstream screening by their logistics provider or airline.
Shippers are taking time to review the new contractual agreement giving TSA jurisdiction over their activities, before signing up for the program. The TSA hopes to approve more shipper applications in the coming weeks after first focusing on forwarder certifications.
The private-sector approach has resulted in a wide range of airline fees and other policies associated with new screening and cargo handling requirements. In addition to standard security surcharges, airlines have created fee structures for screened and unscreened cargo.
Some freight forwarders are still not convinced that pushing screening to air cargo companies is fair or effective.
The Air Cargo Security Alliance, a new organization representing some 220 second-tier airports and small non-asset-based forwarders, is fighting to force TSA to create a federal screening program paid for by a nominal per-pound fee on shipments. It wants the TSA to screen cargo at airports or pay airlines to do the job for them, while retaining the CCSP as an option for shippers who want more reliable service. The alliance has the support of Rep. Edward Markey, author of the 100 percent screening mandate, who plans to introduce legislation to establish the program.
'We're freight forwarders. We're not policemen,' the president of a family-owned forwarder complained to me, adding that the CCSP is costly to implement.
'They're putting the burden on the small businessman who in this type of environment could force us to lay off people because we have to devote money to another purpose,' he said.
Another concern is that the scan-all rule does not apply to all-cargo carriers such as FedEx and UPS, creating what some indirect air carriers believe is an unfair playing field that might encourage customers to switch providers to avoid new security fees and potential cargo backups in the passenger airline system.
Fried, however, dismissed the notion that the government should take over the cargo screening function.
The benefit of the CCSP is that it gives shippers and forwarders flexibility to choose a screening process that suits their needs for various types of cargo, whereas 'a federally run screening process would be more one-size fits all,' he said.
That might work fine at a small volume airport, but would create huge bottlenecks at large international gateways, he added.
'Who can screen better? The forwarders who are around cargo all the time and know its processes or the government that doesn't want to screen and may increase costs and reduce choices?
'The last thing we want to do is put screening in the hands of gross government inefficiency. If the government is providing us the ability to screen cargo we should take advantage of that option and create choices, reduce costs and create process efficiencies,' said Fried, who has requested federal subsidies to help smaller forwarders purchase screening equipment.
'It's the law of land, we have to comply. The way we comply is to make sure the CCSP gets more funding and more participation. In the end, the more CCSP participants there are the less freight will have to be screened at the airport and the faster access those (small) companies will have to the airline,' he added.