The theme of partnership is consistent across many of sections of the Trade Facilitation and Trade Enforcement Act of 2016 (TFTEA). The legislation calls on agencies such as U.S. Customs and Border Protection (CBP), Immigration and Customs Enforcement (ICE), the Department of Commerce, and the United States Trade Representative to strengthen their enforcement posture against trade violations as well as their facilitation roles in order to ensure legitimate trade flows as efficiently as possible. To do this, the different agencies must collaborate on information-sharing, form joint working groups, cooperate with foreign partners, and leverage technology to carry out activities such as combating duty evasion and intellectual property rights violations.
While the TFTEA takes measures to promote new interagency partnerships and also formalizes existing ones, it also promotes and formalizes many public-private partnerships. The institutions, programs, and policies that drive these partnerships are formed through information-sharing and co-creation in a manner that mutually benefits both U.S. authorities and the trade industry. While a number of these partnerships have been in practice for several years, the TFTEA formalizes them and demonstrates Congress’s understanding of the importance of partnerships in balancing enforcement, security, and economic stimulus through trade.
Although the TFTEA has numerous references to public-private partnership throughout its 105 Sections, discussed here are three in particular that represent the current state and evolution of partnerships between CBP and the industry.
Section 101, Trusted Trader
The first item of the TFTEA requires CBP and other federal agencies to work with the private sector to ensure all partnership programs provide trade benefits to participants. This refers primarily to CBP’s premier trusted trader program, the Customs-Trade Partnership Against Terrorism (C-TPAT). Through the partnership, industry participants receive preferential treatment in exchange for voluntarily supplying trade data elements to CBP beyond what is statutorily required and submitting to supply chain security validations. The additional advance information collected allows CBP officers to make more informed decisions and mitigate risk.
Globally, C-TPAT was one of the first programs of its kind. Starting with 7 participating companies in 2001, the program now has over 11,400 partners and accounts for over half of all merchandise imported into the U.S. This growth speaks well to CBP’s administration of the program as does the proliferation in recent years of trusted trader programs across the world, often referred to as ‘Authorized Economic Operator’ (AEO) programs. In its 2016 ‘AEO Compendium’, the World Customs Organization cited 69 programs with over 70,000 participants, and 16 more in development.
However, in order to maintain the innovative program as a world leader, CBP must ensure it is collaborating with industry to provide proper, measurable benefits to industry in exchange for their self-policing security measures and data-sharing responsibilities.
Besides CBP, other U.S. agencies with equities at the border, such as the Food & Drug Administration, Environmental Protection Agency, and U.S. Fish & Wildlife Service, have trade data submission requirements. To provide more efficient service to the industry, there is currently an effort to merge all of these requirements into an integrated U.S. Government-wide ‘Trusted Trader Program’. To accomplish this, there must be cooperative political will to drive the policy changes and technology implementation needed so that the program functions as intended.
Section 109: Formalizing COAC
Ongoing, transparent dialogue between CBP and the trade is important as well in order to co-create new ideas and attempt to find middle ground on disagreements where enforcement and facilitation may conflict. Section 109 of the TFTEA re-formalizes the Advisory Committee on Commercial Operations (COAC) a committee of appointed stakeholders who represent the industry. The nature of their respective agendas inherently means that the trade and CBP will not always agree. However, the COAC assists in reversing the adversarial nature of the Customs/Trade relationship that poses challenges to commerce in many other countries. One successfully co-created idea between CBP and the industry has been the CBP Centers of Excellence and Expertise (CEEs).
Section 110: Formalizing the CEEs
While not a voluntary partnership program in the same manner as C-TPAT, the CEEs take an innovative approach to trade facilitation by providing a streamlined, ‘one-stop-shop’ for industry members to have their questions answered and ‘customer service needs’ uniformly addressed.
The CEEs are managed virtually from 10 locations around the U.S. and have operated on a pilot basis since 2011. Section 110 of the TFTEA now formalizes them. The CEEs move functions of the trade facilitation process from a local port level to a national account management system where all of CBP’s expertise in a single industry can be focused to provide the optimal level of service to industry. The Centers increase uniformity of practices across ports of entry, facilitate the timely resolution of trade compliance issues nationwide, and strengthen agency knowledge on key industry practices to mitigate risk.
Formalization of the CEEs will hopefully mean a more formal dedication of resources by Congress to foster continued innovation. Section 110 also requires performance metrics on the CEEs to be provided, which will assist CBP in continuing to manage them effectively.
Authorities and industry both want secure, efficient trade. This is requisite to competing in the 21st century global economy and can be better achieved through cooperation.
Trusted Trader Programs around the world continue to expand the volume of available trade data. Coupling this volume with advanced data processing technology will allow trade management authorities to collaborate and mitigate risk in the global supply chain. Additionally, institutions like the COAC will help to increase transparency and foster revolutionary concepts like the CEEs. Improved Trade Facilitation and Trade Enforcement through public-private partnerships requires trustbuilding and continued commitment from all involved, but with global security and economic benefits at stake, the effort is worthwhile.
Allen Gina is the co-founder of CT Strategies, a subsidiary of Command Consulting Group in Washington, DC. Prior to founding CT Strategies Mr. Gina served in several posts at CBP, most recently as Assistant Commissioner for International Trade, where he oversaw over 1,000 employees and led the most extensive trade transformation initiative in CBP history. Some other posts he held at CBP during his tenure at Customs include Assistant Commissioner of International Affairs, Assistant and Deputy Assistant Commissioner for Intelligence and Operations Coordination, and Executive Director for the Joint Operations Directorate.
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