Senators introduce sweeping maritime cargo security bill
Legislation proposed Tuesday in the Senate would provide more resources and put pressure on the Department of Homeland Security to develop a comprehensive cargo security strategy and meet a series of deadlines for improving existing programs such as the Container Security Initiative and the Customs-Trade Partnership Against Terrorism.
The GreenLane Maritime Cargo Security Act (S. 2008) is designed to build on existing cargo security programs through tougher compliance standards and incentives for the private sector to beef up supply chain controls, according to bill authors Sens. Patty Murray, D-Wash., and Susan Collins, R-Maine. In addition to raising minimum standards for all cargo shipments, the bill establishes a higher tier of cargo that can move through Customs faster for shippers who voluntarily take extra steps to ensure the integrity of their shipments at every step from the point of manufacture onward. It also would create an Office of Cargo Security Policy to centralize and coordinate cargo security policies and operations within DHS and with other agencies, and guarantee $400 million in port security grants.
The bill, which promotes a layered security strategy and provides a mechanism to keep ports open in the event of a terrorist incident, is a reflection of the growing frustration among many lawmakers that programs quickly implemented after the Sept. 11, 2001 terrorist attacks have stalled, and have not been upgraded to meet the threat of terrorists using containerized trade for smuggling to conceal a weapon for a direct attack.
Legislation was expected after hearings in May at which the Government Accountability Office reported that it found CSI and C-TPAT plagued by loopholes and lack of resources to effectively screen shippers and their cargo. The GAO and lawmakers criticized Customs and Border Protection for reducing inspection levels for C-TPAT shippers based on a review of their paperwork instead of a full audit of how security plans were implemented in practice. As for CSI, a Senate subcommittee investigation determined that only 17.5 percent of containers identified by CBP as high risk are inspected overseas by foreign customs authorities at the request of on-site U.S. inspectors.
To address these issues, the bill requires DHS and CBP to end its practice of granting benefits to members before they undergo a validation process and fully staff CSI locations.
“So what we have now are programs that appear to be hollow,” Collins said at a press conference. “They sound great on paper, the concepts are good ones, but the way they have been implemented offers no guarantee that they are effective.”
The senators endorsed the DHS’s main strategy of using risk-management principles to identify suspicious shipments overseas, rather than trying to inspect millions of incoming sea containers each year. But they said the programs to do so were inadequate.
“There is no way to physically inspect 9 million containers,” said Collins, chairman of the Homeland Security Committee. “The key is to target inspections. Our approach is to better identify high-risk cargo and establish procedures whereby shippers are more responsible for every stage of the supply chain. If you inspect everything you inspect nothing.”
But the current versions of CSI and C-TPAT “are essentially not sufficient to do the job,” Collins said.
The legislation directs the secretary of homeland security to develop a strategic cargo security plan for all modes of transportation that serve seaports, and set minimum standards within six months for securing containers in transit to the United States. The plan, according to the bill, should:
* Clarify roles, responsibilities and authorities of all government agencies at all levels as well as industry.
* Provide measurable goals for C-TPAT efforts to secure commercial operations from origin to destination.
* Outline mandatory, baseline security measures and standards.
* Develop a continuity plan to resume shipments through ports in the event of an attack.
The continuity plan should give preference to cargo on vessels with a Coast Guard approved security plan, entering from a CSI port, operated by C-TPAT member ocean carriers, and from C-TPAT importers who have “green lane” status.
The directive comes nearly one year since DHS held a cargo security summit with industry officials, and indicated it would soon release a national strategy to guide future cargo security policy. It's also five months since Congress asked DHS to submit a report reviewing cargo security measures after an earlier report was deemed sub par.
“Right now DHS has simply been too slow in implementing vital security measures, including working for two years on a regulation to set standards for mechanical seals,” Collins said. It has actually been closer to 16 months since DHS seriously began drafting a seal regulation. But the rule has repeatedly been delayed since it was first expected to be issued early this year.
“Those kinds of delays are simply unacceptable,” Collins said.
Under the GreenLane program proposed by Murray and Collins, importers would only receive “green lane” status if every supplier and transportation vendor within their supply chain is validated by CBP as having implemented best security practices. So far, many C-TPAT importers are using their leverage to get suppliers to follow C-TPAT criteria. But CBP has not had the resources until recently to validate all importers in the program, let alone all their foreign suppliers.
Other criteria for GreenLane cargo are:
* Access to the cargo and containers be restricted to employees who need access and prove their identification.
* Submission of entry data on shipments prior to loading.
* A tracking system for every container.
* A container security device to detect in-transit tampering. The bill instructs DHS to issue performance standards for a container security device within a year and issue rules on available benefits for importers within two years.
The bill would set a deadline of one year for CBP to validate a company with on-site visits to its foreign suppliers, once it has been accepted into the C-TPAT program and require companies to be revalidated at least once every three years.
The bill in many ways authorizes existing regulatory approaches by giving them the force of law. Many proposals have already been implemented or are under consideration by CBP, the agency managing the cargo security programs. CBP has spent the past year developing its “green lane” strategy, which would virtually eliminate security inspections for the most trusted shippers that have undergone a security audit of their supply chains, and implemented industry best practices for maintaining the integrity of the shipment from the factory floor. Among the benefits the bill identifies for importers who join the “green lane” program are fewer inspections, a reduction or elimination of bonding requirements, and the ability to pay customs duties on every shipment on a monthly or quarterly basis.
CBP has cut inspection rates for eligible companies ever since the program was founded more than three years ago. And, CBP earlier this year opened up its monthly payment process to all importers whether they were in C-TPAT or not, as the agency strives to automate and improve customs processing efficiency. CBP is also studying a “trusted account” concept that would provide a basket of benefits that includes eliminating the requirement to post a surety bond for import or export transactions.
CBP is already trying to gain entry information earlier in the process. Last summer, the agency told C-TPAT importers they could gain faster clearance for their goods by transmitting entry-level data 24-hours prior to loading at a foreign port. Bonner has made submission of advance entry data a prerequisite for the top tier of C-TPAT benefits and the “green lane.”
The bill also calls on CBP to consider the use of non-manifest data, such as commercial invoices, and reducing the time period allowed for revisions to the manifest or for submission of entry data to improve the Automated Targeting System used by CBP to rank low-risk and high-risk shipments. The senators also call for an independent panel to review the Automated Targeting System and consider the use of more complex algorithms and real-time intelligence, instead of relying on rule sets that are periodically updated.
CBP has spent the past 18 months on a pilot program called the Advanced Trade Data Initiative to identify what types of commercial data are useful for security purposes and how to access that information.
The bill also instructs DHS to complete the implementation of the International Trade Data System, designed to be a single window for reporting import and export information to all relevant government agencies. Industry, which views the system as a way to streamline redundant filing of trade data, has been pressing the White House and DHS to force slow-moving agencies to participate in the program and configure their systems to be compatible with ITDS.
CBP has deployed about 500 radiation portal monitors at ports of entry at which all containers to passively examine all containers. But the bill says less than a quarter of the detection equipment required is in place. The bill directs DHS to examine all inbound containers for radiation no later than one year after enactment of the bill.
The legislation rubber stamps many aspects of CSI, but adds instructions for the department to establish technical requirements and standard operating procedures for X-ray and radiation detection equipment used at CSI ports. It also creates an office with the State Department to assist DHS in negotiating cargo security related international agreements and conducting enforcement with foreign governments.
A Senate subcommittee and the GAO were critical of CBP in May for not establishing minimum technical requirements for the detection capability of non-intrusive equipment used by other governments participating in CSI. But in an interview with American Shipper last week CBP Commissioner Robert Bonner took a dim view of congressional complaints about CSI, and said there are limits to what the United States can demand from other nations who have agreed to conduct outbound inspections and purchased the expensive equipment on their own.
“This is what I thought was the ultimate chutzpah. To say that your non-intrusive equipment has to comply with this standard, well that’s maybe a push too far,” Bonner said. “That’s not to say there shouldn’t be some standard notion. There should be,” and CBP would raise the matter with any customs authority it felt didn’t have adequate capability to conduct inspections, he said.
“It’s not as simple as saying that you need ‘x’ inches of X-ray penetrating power, because there are different situations where we need mobility,” and there is a trade off between fixed and mobile sites, he said.
“On the other hand, we do want some minimal level of ability and we can build that in as we evolve the partnership,” Bonner said about the program, which has expanded to 40 ports around the world. “It’s just somebody coming in when we are down to the 20-yard line of the opposition here in terms of completing this program, and saying you should have done this. Well we probably wouldn’t have a CSI program. If I had started off and I’d said to the Dutch and Singaporeans, well not only do you have to have this equipment, but here’s the equipment you have to have and it has to meet these standards,” they wouldn’t have joined the effort to protect U.S. borders, he said.
“You can’t get bilateral agreements and start dictating.”
Bonner, who in response to the GAO report partially dialed back the benefits available to C-TPAT companies until they are validated, also took issue with congressional criticism of C-TPAT. CBP had to extend some benefits to attract importers to the voluntary program, but didn’t have the personnel and expertise at the beginning to properly verify corporate supply chains. As the program has grown and gained resources the standards have been ratcheted up, he pointed out.
“How would we know what the criteria were? We learned what the best practices for security and the movement of goods through the supply chain, not because U.S. Customs knew what they were, but because we dealt with the trade and we learned how the best companies secure a supply chain,” he said.
The bill authorizes $835 million for cargo security measures, including $400 million each year between 2007 and 2012 for the port security grant program, to be funded by duties collected by CBP. Language on port security grants clarifies what types of entities can apply for funding and allows for some multiyear funding for grants.
The DHS 2006 fiscal budget includes $175 million for port security grants.
The American Association of Port Authorities, which has lobbied for more money to reimburse ports for measures taken to comply with maritime security laws, issued a statement praising portions of the bill devoted to the grant program.
“Dedicating a small portion of the Customs revenues already being collected on maritime commerce is an appropriate funding source,” it said.
Stephen Flynn, a well-known security analyst at the Council on Foreign Relations who testified about the two cargo security programs last spring, said in a statement released by the senators that the bill “is the most comprehensive legislative initiative to date to tackle the challenge of ensuring that an intermodal container is not used as a poor man’s missile. It redresses many of the well-documented weaknesses of the C-TPAT and CSI programs, and provides a framework for rewarding private sector players who work with DHS to raise the security bar.”
Collins said she hoped to schedule a hearing on the bill in January and move the bill through her committee.
