New C-TPAT benefit designed to reduce demurrage charges
Trusted shippers on Wednesday received a new benefit for participating in the government's Customs-Trade Partnership Against Terrorism.
Todd Owen, executive director for cargo and conveyance security at U.S. Customs and Border Protection, announced that multiple containers arriving under a single Customs entry will no longer have to be held on the terminal and incur late pickup charges if only one container in the group is targeted for an inspection.
Based on a four-month test in the Port of Los Angeles, CBP has instructed its field directors to develop procedures to limit container 'holds' to cargo that has been targeted for inspection at a special cargo examination warehouse, Owen said at the C-TPAT annual conference in New Orleans.
Under current practice, CBP places a do-not-release message, or hold, on containers listed on the entry form even if only one of the containers is subject to inspection. Shippers often group containers on a single entry for convenience rather than filing separate forms for each container.
Customs exams can take several days and a shipper with 10 boxes listed on one customs form often must pay demurrage fees on the remaining containers until the inspection is completed and CBP releases the shipment. Most terminals now only allow shippers five days of free time before they must pick up their boxes or get slapped with a storage surcharge.
The new benefit comes on top of reduced cargo inspections, faster processing time at land border crossings, front-of-the-line treatment when inspections are necessary and priority drawback processing. Companies that sign up for the program receive the benefits in exchange for instituting strong internal controls and making sure their foreign suppliers and transportation providers follow the same standards outlined in their security plans.
Owen said that the importer can truck the remaining containers out of the terminal to its premises, but has to keep the container intact and not breach the seal until CBP lifts the hold on the entire shipment. The importer will also have to make the other containers available to CBP, if necessary, after the initial inspection, Owen said.
CBP can implement the new procedure because of the confidence level it has in C-TPAT importers, who have had their security practices verified by agency specialists.
'This is one way to add meaningful benefits,' Owen said to applause from 700 importer representatives at the conference.
CBP did not indicate an exact time when the new procedures would be in place. It's likely that some technical adjustments will have to be made to the Automated Manifest System that CBP uses to communicate with the terminal operators and ocean carriers about cargo status information.
Late last year CBP began penalizing terminal operators who inadvertently allowed containers that had been targeted for inspection to be removed from their property. The miscommunication was due in part to the inability of AMS to communicate with terminal operating systems when hold messages were applied at the last minute. Most terminal operators have since adjusted their systems to better synch up with AMS.