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Securing the Global Supply Chain

Measures being undertaken by the U.S. Customs and in cooperation with other Customs agencies worldwide are helping to ensure the security of the worldwide supply chain.

LDW: Logistics, Distribution & Warehousing 2009
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Customs-to-Customs and Customs-to-Business Partnerships
The CBP uses the WCO network of Customs-to-Customs Partnerships and Customs-to-Business Partnerships as the key ingredients behind the CBP's globalization for supply chain security, and bases its framework of standards on the same four core principles as the WCO:

1. Standardization of advance electronic cargo information requirements for inbound, outbound, and transit shipments

2. Commitment to the use of consistent risk management approach to address security threats

3. Performance of outbound inspection of high-risk containers and cargo by the nation from which the cargo was shipped at the reasonable request of the receiving nation, preferably using nonintrusive inspection equipment

4. Adoption of Customs-to-business partnership programs (such as C-TPAT)

The Customs-to-Business Pillar of the WCO Framework contains an Authorized Economic Operator (AEO) protocol, which provides member organizations with guidance as well as a system to provide benefits to those organizations that are security-focused. The U.S. C-TPAT program is an example of an AEO protocol wherein Customs organizations, with input from the trade organizations that make up the bulk of the users, can develop and implement a validation program that demonstrates that a minimum level of security standards for their supply chain are being met. This program allows C-TPAT members to obtain the corresponding benefits that are made available to the participating AEO member.

Mutual Recognition Standards
Working to develop a "mutual recognition" of standards based on the AEO protocols and compliance levels, which are part of the Customs-to-Customs Pillar of WCO Framework, will provide a clear benefit to members and reduce the need for member nations to provide multiple assessments. A "mutual recognition" program with fixed standard levels will allow member countries to validate and perform assessments of supply chain security actions and reduce the number of duplicate actions that may have been taken by a fellow member nation. This would help all of the nations by reducing the costs of validations and assessments and speed up the process of goods movement via known and validated shippers.

The end result is that the U.S. CBP, in order to create a more secure trade environment and goods flow into the United States, has begun implementing initiatives overseas. These new practices now have them engaging with not only U.S. importers and the complexities of import (or exporters and export) supply chains, but also interacting on broad global initiatives with many foreign governments in order to provide a full context for global trade security. This expanded framework for cargo security is directly focused on identifying higher-risk cargo for inspection programs, and allowing lower-risk cargo to flow smoothly and efficiently.

The outcome of these global actions is that global trade remains relatively safe. Participant nations and global traders understand the benefits that accompany the security initiatives as they increase supply chain velocity, provide a higher level of predictability, and lower the costs across trade lanes. By applying security initiatives with member companies and member nations, the CBP has made great progress to enhance security worldwide.

Curtis Spencer is also a member of the 9th and 10th COAC Committee.

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