Recent Trade & Tariff Perspectives

August 18, 2021 | Sarah Stock Senior Trade Policy Advisor

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Key Updates on the Customs Trade Partnership Against Terrorism (CTPAT) Program

On July 22, 2021, U.S. Customs and Border Protection (CBP) hosted a session specific to the Customs Trade Partnership Against Terrorism (CTPAT) Program as part of its Virtual Trade Week. The event panel shared some important updates for current CTPAT members, as well as for companies considering joining the program. C.H. Robinson shared other key takeaways from the Virtual Trade Week last week.

Current state of the CTPAT program

Manuel Garza, Director of CTPAT at CBP, shared some interesting statistics about the current program. COVID-19 put an unexpected strain on businesses around the globe, reducing membership by approximately 500 due to business closings.

Despite business closings, however, overall CTPAT membership is still hovering around 11,000 total members, in part due to the approximately 200 companies in the CTPAT application stage. Many of the applicants are highway carriers that transport goods across the Northern and/or Southern borders of the United States. Of current members, nearly 300 belong to the Trade Compliance program within CTPAT.

Though CBP demonstrated patience and flexibility through the struggles COVID-19 placed on CTPAT members, CBP has now moved into enforcement mode. Since CTPAT is a voluntary security program, enforcement does not refer to fines and penalties.

Instead, when a CTPAT member is found to be non-compliant, CBP simply suspends or removes the company from the program. Director Garza said there are currently 76 companies suspended from CTPAT, and a total of 43 have been removed during the calendar year.

Virtual validations

With the travel bans stemming from COVID-19, CBP moved to virtual validation meetings to verify member compliance with their established supply chain security programs. Director Garza said the development of virtual validations for Tier III members was under development prior to the onset of COVID-19, which allowed CBP to quickly pivot to this new format.

You can expect CBP to complete a mix of virtual and on-site validations. The virtual validation process has been largely successful and welcomed by both CBP and program participants, as it allows for efficiency and reduced travel costs for everyone involved.

Jeff Gifford, Director of Border Security & Asset Protection at Magna International, shared his perspective as a CTPAT importer undergoing the virtual validation process. He said the use of technologies, such as wearable head cameras and drones, allowed his company to successfully host “virtual tours” for CBP at their facilities. This does not mean you need to immediately invest in drones.

As with the CTPAT program at large, the validation process allows for a flexible approach based on your company’s size, supply chain, and facilities. Where drone technology may be the right choice for one company, evidence of implementation, such as photographs and/or camera feeds, may suffice for others. C.H. Robinson’s Trade Policy team has successfully navigated the validation process with clients and can assist in recommendations specific to your company.

Regardless of format, however, CBP will continue to require evidence of implementation of the new minimum-security criteria, especially in the areas of cybersecurity and agricultural security. Cybersecurity requirements represent the most sweeping changes within the CTPAT program, as cybersecurity itself remains a pressing issue around the globe.

Other keynotes

Forced labor: Though forced labor requirements are currently a recommendation rather than a requirement within the CTPAT program, combating forced labor remains a priority. CBP is looking to implement social compliance programs as a requirement for CTPAT trade compliance members. Since this is an extremely important issue that relates to both CTPAT and import compliance, C.H. Robinson recommends that all companies implement social compliance programs to ensure that no forced labor is used within the supply chain.

WBO recognition: CBP and the World Business Alliance for Secure Commerce Organization (WBO) issued a joint statement on April 27, 2021, confirming their intent to work together on an action plan consisting of nine key points. One point includes the potential to recognize companies that are certified within the Business Alliance for Secure Commerce (BASC) program. In other words, when a CTPAT member has a BASC-certified company as part of its supply chain, the member would only need to document the company’s BASC certification as part of its business partner security requirements.

Program benefits and improvements: CBP will continue to look for ways to enhance and report upon the benefits for CTPAT members. Though that can be difficult to quantify for each specific CTPAT member, CBP is looking for ways to improve.

For example, CBP is exploring the addition of an average exam cost (as an average for importers) and the CTPAT member’s total number of exams to be provided in the CTPAT portal, which could be released later this year. However, CTPAT members should continue to track their own figures, such as actual costs for customs examinations to quantify their own savings based on program participation.

In addition, based on the study that was released by The Borders, Trade, and Immigration Institute (BTI), and led by the University of Houston, CBP has established three working groups specific to improving CTPAT, focused on benefits, communication, and technology.

How C.H. Robinson can help

C.H. Robinson’s Trade Policy Team offers a depth of experience related to the CTPAT program. We have navigated many companies through the CTPAT certification, validation, and re-validation processes, and our approach has proven to be successful for clients facing virtual validations this year. Our team is available to help, so please contact us with your questions. Looking to learn more? CTPAT Program Overview and Information (cbp.gov)

  • CBP Virtual Trade Week (cbp.gov)
  • Forced Labor (cbp.gov)
  • CBP and WBO Joint Statement (cbp.gov)
  • BTI/University of Houston Assessment of CTPAT Program (uh.edu)
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