October 7, 2005

The following article is excerpted from the 7 October 2005 edition of “The Journal of Commerce”.

An increasing number of importers that exhibit diligence in securing their supply chains from the stuffing of containers overseas to delivery in the U.S. are qualifying for Customs' coveted designation as Tier Three importers.

Some importers have complained that it is next to impossible to achieve Tier Three status under the Customs-Trade Partnership Against Terrorism program. Importers validated for Tier Three status receive no cargo inspections for security purposes.

Customs and Border Protection on Thursday informed private sector representatives that since its inception three years ago, C-TPAT has validated about 425 importers for participation in the cargo security program. Some 110 of those importers, or 25 percent, have achieved Tier Three status.

"It's difficult, but it's possible," said Todd Owen, director of Customs' C-TPAT program in the office of field operations. …

U.S.-based importers that qualify for participation in C-TPAT must demonstrate to Customs that they have implemented security measures throughout the supply chain. Customs offers
a tiered menu of incentives in the form of reduced inspections and flexibility of documentation filing requirements depending upon how secure an importer's supply chain is judged to be.

For example, importers designated as Tier One participants are targeted for security inspections less frequently than importers who do not participate in C-TPAT. Tier Two
participants experience even fewer inspections than Tier One importers. Tier Three importers are given Customs' "green lane," which means they will not be targeted for Customs inspections for security purposes. All U.S. importers are subject to random inspections for possible commercial infractions.

Customs continues to ramp up its validation efforts for C-TPAT. Through Jan. 1 of this year, about 400 importers, carriers and customs brokers were validated. In the first nine months of this year, an additional 556 companies received C-TPAT validation, Owen said.

Owen told a meeting Thursday of the Departmental Advisory Committee on Commercial Operations of Customs and Border Protection and Related Functions that Customs has increased
C-TPAT staffing 134 percent. Customs has C-TPAT supply chain specialists in Los Angeles, John F. Kennedy International Airport in New York, Miami, Washington and its latest office
to open, Newark, N.J.

COAC was established to provide Customs with private sector input on how the agency's decisions affect international trade. Importer representatives at Thursday's meeting said
C-TPAT could be further improved if Customs would develop data to measure the effectiveness of the program in securing the nation's borders. Also, importers want a clearer
statement of benefits they can bring to their CEOs to show that participation in C-TPAT is producing a positive return on investment.