C-TPAT Fciq presentation 20121018 updated

Field OperationsMarch 2012

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An introduction to the program, state of play and explanation of its operations

Presented by

Ron May

Director, Buffalo, NY C-TPAT Field Office


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C-TPAT Achievements October 9, 2012

• 10,397 - Certified Partners to current date

• 164 - Total C-TPAT staffing level

• 21,454 - Total Validations Completed– 11,516 - Initial Validations Completed– 9,938- Re-Validations Completed

• Number of completed validations by year: -2011 / 715-Initial Validations / 2,229-Revalidations

2,940-Total Validations in 2011

-2012 / 460 -Initial Validations / 1,145-Revalidations 1,605-Total Validations in 2012

• 1,453 - Total Suspensions• 1,100 - Total Removals

• Internationalization Efforts: – 6 - Mutual Recognition Arrangements: New Zealand, Canada, Jordan , Japan, Korea, European Union– 2 - Mutual Recognition Projects: Taiwan, Singapore– 12 - Technical Assistance Projects: Malaysia, Mexico, Philippines, Guatemala, China, Colombia,

Israel, Peru, Vietnam. Dominican Republic, Costa Rica, India– 2 - Capacity Building Training Programs: Ghana, Kenya– 4 - Rounds of joint validations with the General Administration of China Customs

• Security Criteria Implemented:– 10 - Business Entity Types: Importers, Air Carriers, Highway Carriers, Mexico Long Haul Highway

Carriers, Rail Carriers, Sea Carriers, Foreign Manufacturers, Customs Brokers, Port Authorities/Terminal Operators, Third Party Logistics Providers (3PLs).

• Tiered Benefits Structure – commensurate with security enhancements. Best Practices Catalog.– 329 - Tier 3 Importers

4352

2985

852

1263

88560

Certified Members by Business Type Importers - 4352

Carriers - 2985

Brokers - 852

Foreign Manufacturers - 1263

Consolidators/3PLs - 885

Marine Port Authorities and TerminalOperators - 60

0

1000

2000

3000

4000

2006 2007 2008 2009 2010 2011 2012

Validations By Year


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Tier III Importers• 329 Partners• 27% of Entry Value• 15% of Entries

FY10 – Entry Values


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“The C-TPAT Supply Chain Security Specialist (SCSS) primarily conducts C-TPAT Validations of C-TPAT member companies and serves as the principal advisor and primary point of contact for certified members in the C-TPAT program.”

• 146 SCSSs Currently On-Board; includes 18 Headquarters employees

• Seven field offices: New York, Washington D.C., Miami, Los Angeles, Newark, Buffalo, Houston

• Extensive travel

Supply Chain Security Specialist


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Program Travel

• Covered 6 of 7 continents

• Nearly 100 countries visited (multiple visits within higher risk countries)

– Angola - Colombia - Malaysia

– Bangladesh - Brazil - Russia

– Israel - Mexico - Guatemala

– Sri Lanka - Jordan - El Salvador

– Pakistan - Egypt - Haiti

– India - Ivory Coast

– Botswana - Nicaragua**Each SCSS averages approx. 75-100 days a year on travel


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C-TPAT Program Business Types

C-TPAT program currently has 10 Business Entity Types:

Importers Sea Carriers U.S./Canadian Highway Carriers U.S./Mexico Highway Carriers Rail Carriers Air Carriers Mexican and Canadian Foreign Manufacturers Licensed U.S. Customs Brokers Mexico Long Haul Highway Carrier U.S. Marine Port Authority/Terminal Operators Third Party Logistics Providers (3PL)


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Minimum-Security Criteria• Risk Assessment• Business Partner Requirements• Conveyance, Container & Trailer Security• Physical Access Controls• Personnel Security• Procedural Security• Physical Security• Security Training and Threat Awareness• Information and Technology Security

These criteria are posted both in Spanish and English andthe criteria for foreign manufacturers is posted in 12different languages to include Thai, Chinese and Arabic.


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What is a Supply Chain?

FOR HIGHWAY CARRIERS:

The supply chain for highway carriers for C-TPAT purposes is defined from the yard where the tractors and trailers are stored, through pickup at the manufacturer/supplier/vendor, through to the consignee.

Raw MaterialSupplier

Consumer Consignee

Conveyance


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Validation and Revalidation Visits

• Initial validation visits take place within 12 months of certification (unless documented circumstances prevent this)

• Revalidation visits take place within 4 years of original validation completed date.

• C-TPAT partner is strongly recommended to attend overseas or foreign portion of validation or revalidation visit.

• CBP covers cost of its employees for travel and accommodations. C-TPAT participant only covers cost associated with its own employees.

• Many factors are considered in selecting site visit, but primary focus is still on greatest risk to overall supply chain and CBP’s need for compliance with the SAFE Port Act.

• Additional considerations:– Recent incidents or problems at another location– Newly acquired supply chain components– Lack of additional sites to visit– Law enforcement information (internal CBP decision)– Volume or production rates from site– Weather, holidays, labor issues, political issues, disease concerns and other unique circumstances.


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Documented Procedures EVIDENCE OF IMPLEMENTATION How far back did you go?

Risk Assessment

Business Partners

Conveyance Security

Inspection

Physical Access Controls

Current week______________________

1-6 months________________________

6-12 months ________________________

Over 12 months____________________

Document/checklist/form

Other ____________________

None

WRITTEN PROCEDURES

Reviewed and obtained copy of procedures/documentation/files

Reviewed procedures/documentation/files - no copy obtained

Documenation uploaded in portal

Observed process / site tour

Photo evidence / document scanned

Explanation of compliance by management / department employee


Other ____________________

None

WRITTEN PROCEDURES



Other ____________________

None

WRITTEN PROCEDURES




















Other ____________________

None

WRITTEN PROCEDURES

Documenation uploaded in portalDocumenation uploaded in portal


Other ____________________

None

WRITTEN PROCEDURES



Other ____________________

None

WRITTEN PROCEDURES



Other ____________________

None

WRITTEN PROCEDURES



















Other ____________________

None

WRITTEN PROCEDURES



Other ____________________

None

WRITTEN PROCEDURES



Other ____________________

None

WRITTEN PROCEDURES

Documenation uploaded in portalDocumenation uploaded in portalDocumenation uploaded in portalDocumenation uploaded in portal

Current week______________________

1-6 months________________________

6-12 months ________________________

Over 12 months____________________

Current week______________________

1-6 months________________________

6-12 months ________________________

Over 12 months____________________

Current week______________________

1-6 months________________________

6-12 months ________________________

Over 12 months____________________

Sample Matrix:

Increase Focus on Evidence of Implementation


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Post Incident Analysis (PIA)When a C-TPAT participant is involved in a supply chain incident, HQ C-TPATprogram staff will examine the incident and provide details to C-TPAT management sothat they can determine the correct response from the program.

All Post Incident Analysis (PIA) will be conducted within 30 days.

The Field Director will assign a SCSS team to conduct the PIA (usually involving thecompany assigned SCSS). The PIA report, with program status, and recommendationsmust be finalized within this 30 day time frame.

Once the Field Director receives and reviews the PIA report and discusses and approvesthe company status recommendation, the full report and recommended actions are thenforwarded to HQ for review by C-TPAT Management. All final decisions on PIA results,recommendations and C-TPAT program actions must be approved at the HQ C-TPATmanagement level.


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Canadian Company Participation in C-TPAT

Applicants Certified Validated Suspended/Removed

Importers 2 39 1041 84

Hwy Carriers

23 145 1349 187

Foreign

Mfrs.1 10 136 8

Totals 26 194 2526 279 (10%)


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Mutual Recognition (MR) Process

(4) Phases1. Side-by-side comparison of program

requirements2. Pilot programs of joint

validations/observations3. Signing of agreement4. Development of information sharing

procedures


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PIP/PEP

Presentation courtesy of:

Bill Tu

Senior Advisor, CBSA

International & Bilateral Trusted Traders - PIP Program


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Beyond the Border:“A Shared Vision for Perimeter Security and

Economic Competitiveness”• The “Beyond the Border” Declaration was announced by Canadian

Prime Minister Stephen Harper and U.S. President Barack Obama in February 2011

• Four key principles underpinning the Declaration:

- Addressing threats early

- Trade facilitation, economic growth and jobs

- Integrated cross-border law enforcement; and

- Critical infrastructure and cyber security


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Harmonization refers to further aligning both programs, where

applicable, in the areas of policy, procedures and

documentation practices while each country retains sovereignty

over its own program.

Harmonization Benefits:

Single application process for companies seeking to join both programs

Only one site validation required

Creates streamlined and efficient border processes

Enhances security and integrity of the company’s supply chain

Harmonization of PIP & C-TPAT


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Harmonization of PIP & C-TPAT

• Implementation:

– Phase 1: Pilot harmonization of two Canada - and two US-based highway carriers, completed in 2011

– Phase 2: Harmonization 1.0 of Canada and US highway carriers, scheduled for 2012

– Phase 3: Harmonization 2.0 of all other common lines of business, line by line (to the fullest extent possible), scheduled for December 2013


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How the MR process will work

• Both administrations will use risked base scoring to lower exam levels. Lower risk level will be communicated to each administration via automated systems (in development).

• Each administration will monitor application of risk reductions through normal measurement matrix’s, but will also use random audit element.

• Process will be very fluid and evolve quickly through live learning.


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MR benefits

• Coordination between US and Canada administrations

• Less duplication (1 visit for both programs)• Business resumption considerations for program

participants• Established points of contact within each

administration• First to receive important informational notices• Global marketability


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Challenges to MR process

• Logistics of process (time, travel, money)

• Differences in information collection and sharing laws, rules, and regulations

• Development of common data platform to share information (IT)


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Centers of Excellence and Expertise

Overview

May 2012


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BackgroundResponding to the Call for Trade Transformation

In direct response to calls for more uniform and efficient facilitation, and in collaboration withthe Commercial Operations Advisory Committee (COAC) during FY 2011 CBP created twopilots

The resulting pilots underwent careful concept testing and validation both within CBP andwith the broader trade community

CEE and AE Pilots

The Center of Excellence and Expertise (CEE) pilot was established in November 2010 toenhance facilitation, improve enforcement efforts, and increase CBP's knowledge of thepharmaceutical industry

The Account Executive (AE) pilot was established to work with selected “trusted partners” inthe electronics industry to facilitate trade, while ensuring continued compliance with all importrequirements

Both pilots relied on small cross-occupational core teams, with matrix staff bringing additionalspecialized expertise. At the conclusion of the pilots, the AE concept was combined with the CEE to create new centers to segment risk, facilitate trade for trusted partners and develop comprehensive enforcement strategies:

Objective: make CBP’s haystack smaller


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Current CentersFour Centers Currently Established since October 2011**

Pharmaceuticals, Health & Chemicals Center (NY, NY)

• Covers the full spectrum of commodities within the Pharmaceutical industry, and will expand to include Chemicals and Health equipment industries

Electronics Center (Long Beach, CA)

• Covers the full spectrum of commodities within the Information Technology and Consumer Electronics industries


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Current Centers continued

Automotive & Aerospace (Detroit, MI)

• Covers the full spectrum of commodities within the Automotive, Aerospace, and

transportation related industries

Petroleum, Natural Gas & Minerals (Houston, TX)

• Covers the full spectrum of commodities within the Petroleum and related industries as well as minerals


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What CEE’s will provide

• Centers serve as a single point of processing for businesses enrolled in CBP’s trusted shipper programs - Customs-Trade Partnership Against Terrorism (C-TPAT) and Importer Self Assessment (ISA)

• Centers will increase industry-based knowledge to segment risk, develop trade facilitation strategies, and enhance enforcement

• The Centers will also serve as a resource to the broader trade community and to CBP’s U.S. government partners


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Proposed Centers

1. Agriculture & Prepared Products2. Automotive & Aerospace *3. Base Metals & Machinery4. Consumer Products & Mass Merchandising5. Industrial & Manufacturing Materials6. Electronics*7. Petroleum, Natural Gas & Minerals*8. Pharmaceuticals, Health & Chemicals*9. Textiles, Wearing Apparel & Footwear


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Benefits of Centers

Action• Eliminate unnecessary

transactional work for compliant importers

• Shift focus at Ports of Entry to high-risk shipments

• Provide single point of contact for inquiries

• Develop cross-functional expertise

Benefits• Fewer cargo delays• Reduced costs• Greater predictability• Better use of CBP employees• Stronger CBP to importer

relationships• Increased uniformity and

transparency for trade• CBP expertise and learning

abilities will increase with more specialization


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Nexus

• Joint program with CBSA• Goal is to “establish and expand trusted travel

lanes at airports, waterways, and land crossings”.

• NEXUS card fulfills travel document requirement of Western Hemisphere Travel Initiative (WHTI)

• Qualify if citizen or permanent resident of US or Canada residing in either country

• Gives expedited clearance at air, land and marine modes of travel (additional requirements for air travel).


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NEXUS Information

• Toll free information (US or Canada):

1-866-639-8726

www.nexus.gov

or

www.nexus.gc.ca


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Email Contact

[email protected]

C-TPAT Fciq presentation 20121018 updated

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