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American Shipper

Selections near for trial program to outsource C-TPAT validations

Selections near for trial program to outsource C-TPAT validations

U.S. Customs and Border Protection plans to select by the end of May private sector inspection service providers that will be eligible to provide supply chain security validations in China for U.S. importers participating in the Customs-Trade Partnership Against Terrorism.

   Todd Owen, executive director of cargo and conveyance security, made the announcement last week during the quarterly meeting of the Commercial Operations Advisory Committee, comprising 20 representatives from the import-export industry.

   The pilot program was mandated by Congress in response to complaints that the agency was taking too long to complete supply chain security assessments and thus delaying companies from receiving reduced inspection levels and other benefits. CBP has increased its C-TPAT staff to its stated goal of 156 persons, and said it is on track to complete validations of all remaining certified applicants to the voluntary partnership program, and all new applicants within a year.

   Instead of a force multiplier to speed up the process, CBP is using the pilot program as a way to vet the security plans of companies who do business in China because it is the only country that has not granted access to CBP officers to conduct in-country audits of foreign suppliers. CBP plans to use third-party validators as a substitute means of documenting whether Chinese factories and transportation providers follow the minimum-security criteria established by their C-TPAT customers. The agency will review the information and determine whether the company is eligible for full C-TPAT privileges.

   CBP received bids from 24 trade audit and inspection firms by the April 30 deadline, but seven of those didn’t apply for SAFETY Act protection as required by the solicitation, Owen said. Congress passed the Support Anti-Terrorism by Fostering Effective Technology Act in 2002 to provide liability and insurance protection for companies offering technologies and services for homeland security purposes. It is designed as an incentive for companies that might hold back from developing and commercializing technologies could save lives out of fear that they will be sued if a product failure contributes to the successful execution of a terrorist attack.

   Three C-TPAT field directors are in the process of evaluating the 17 remaining firms on their ability to perform the validations as well as their established presence in China, Owen said.

   Companies will be evaluated on stated requirements for compatible data collection capability and electronic transmission of results to CBP, training programs for auditors, fee schedule, employee background checks and other factors. Inspection services will have to sign non-disclosure forms and attest that they are free from any conflict of interest with the importer that pays for the service.

   After the third-party validators are selected, CBP will reach out to the roughly 300 importers in C-TPAT who source most of their goods from China to let them know which companies they can hire for outsourced C-TPAT validations. Security assessments could begin by early summer.

   Meanwhile, CBP is considering opening enrollment in C-TPAT to two new industry sectors: Mexican long-haul motor carriers and third-party logistics providers. Only short-haul truckers that shuttle trailers across the southern border have been eligible to participate in C-TPAT.

   Congress called for further expansion of C-TPAT in last year’s SAFE Port Act.

   Owen said CBP is trying to determine how to apply the program’s minimum-security criteria to 3PLs because such a large part of their business involves the use of subcontractors.

   “We need to have strong assurances that the strongest security measures have been pushed back by that 3PL to everybody that they are contracting and subcontracting with,” Owen said.