AAEI sent comments to Sen. Bill Cassidy, (R) LA, on the draft of his proposed bill to modernize U.S. customs law.
AAEI notes that the current draft bill does not address trade facilitation. “We believe this discussion draft seems to be a departure from the mutual collaboration that the recent generation of traders have come to know as the best and safest way to move forward in our industry. The focus on enforcement is understandable given all the burdens and threats the modern supply chain bears. However, a sharp departure from facilitation ultimately could make trade less safe, more expensive, and opaque.”
AAEI emphasizes two important elements included in the landmark Customs Modernization Act of 1993 (MOD Act), informed compliance and shared responsibility. “The original MOD Act issued a new era in trade facilitation: simplifying required paperwork, modernizing procedures, and harmonizing customs requirements, which slashed costs and time needed to export and import goods. As noted by the World Trade Organization’s Trade Facilitation Agreement (TFA) ‘Reductions in time and costs to trade can thus make the difference between a country seamlessly linking up to an integrated global production chain or being left on the margins of a big part of world trade. Moreover, amid a global slowdown in trade, easing trade processes can provide a critical boost to international trade and the global economy.’”
In the spirit of shared responsibility, AAEI provides Sen. Cassidy with its vision for US. Customs and Border Protection’s (CBP’s) trade role over the next 30-years. They include:
- Improve the partnership between CBP and the trade community by renewing the COAC and confirming a CBP Commissioner.
- Reasonable care decision-making should be re-engineered and measured at the account level instead of transactional levels.
- Informed compliance should include transparent programs and reliable guidance that eliminate penalties.
- There should be a “One-Government” approach to customs modernization, where participating government agencies work to develop complementary and coordinated risk management processes, including the sharing of information; identifying trusted traders; and providing a single release at the border.
- Value “Trusted Traders,” by making sure that the pursuit of new data from unknown and new players in the supply chain does not harm trusted traders or traditional business.
- Advanced Data is not better data. The trade can provide the best data closer to the ports of entry. More important, without commercial benefits, advanced data requirement will create additional costs and bottlenecks for the trade community in a time when there are inflation fears and port congestion.
- CBP should be managed by metrics, reporting its actions identified as critical: e.g. time frames for cargo release.
- Automated Customs Environment (ACE) should be re-engineered to facilitate trade not just police it.
Improving the identification of “responsible parties” and limiting the severity and scope of penalties for those parties with limited knowledge of trade transactions. The changes made by the proposal to the penalty provisions of U.S. customs laws may have unintended consequences that could greatly impact less sophisticated actors who have recently started engaging in international trade.
As AAEI’s letter states, “Ultimately it should be up to the trade, as it was 28 years ago, to proactively layout the vision for customs and maintain the original MOD Act’s tenets.”