Page 12: of Maritime Logistics Professional Magazine (Q1 2011)

Maritime Risk

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12 Maritime Professional 1Q 2011

The United States after 9/11 jumped into the lead in secur- ing the international supply chain as it relates to container movement. But where is it today? In fact, U.S. failures in developing container security technology, scanning, and cooperating internationally remove the U.S. from any leader- ship role in securing our ports and container traffic. The

United States must now look to other nations and the private sector for leadership in this area.

THE GLOBAL ROOTS OF CHANGE

The effort to modernize the global supply chain by defining and implementing electronic data collection and controlling container movement began with two prime movers: the

Revised Kyoto Convention and the World Customs

Organization (WCO).

Today's standards for improving and modernizing Customs practices around the world had their genesis in the Revised

Kyoto Convention of 1999. It supported the concept of applying new technology to Customs practices by simplify- ing procedures, emphasizing information technology and risk management, and using systems to target, select and inspect high risk shipments based on pre-arrival information. The

Convention's Information and Communication Technology

Guidelines (ICT) promote the advance electronic transmis- sion of information to Customs computerized systems, including electronic exchange of information at export and import.

The WCO adopted the Revised Kyoto Convention on June 26, 1999 and used it as the foundation of its Framework

Standards to Secure and Facilitate Global Trade (Standards) which were adopted by the WCO Council in June 2005. As of July 2009, 156 members out of 174 agreed to follow the

Standards, including the United States. The four core ele- ments of the Standards are: 1. Advanced electronic manifest information requirements; 2. Common risk-management approach; 3. Inspection of certain container by non-intrusive means; 4. Benefits to Businesses for cooperation.

WCO proposed programs to push the security of containers further back into the supply chain by involving the private sector, a significant decision bearing fruit today, and by requiring increased security from "stuffing" the container at a foreign manufacturer’s loading docks, and its movement through the supply chain to destination. The Appendix to

Annex I of the Standards is dedicated to container security.

THE EVENT OF 9/11 AND THE U.S. RESPONSE

After the shock of 9/11, it was the United States that clear- ly took the lead in container security through U.S. legislation, programs, and funding for technology development. U.S.

Laws were responsible for greater data collection, the use of electronics, ports safety, technology development, and direc- tion for the Department of Homeland Security (DHS). These included The Trade Act of 2002 and Maritime Transportation

Security Act of 2002, the SAFE Port Act of 2006 and

Implementing the 9/11 Commission Recommendations Act of 2007. All U.S. programs and systems have their strengths and weaknesses. Unfortunately, all of them have two core weaknesses against which there is no mandated fix: acquisi- tion of reliable data on the contents of a container and trans- shipment vulnerability. Additionally, the programs and sys- tems listed below. lack the required identity of the actual per- son verifying the contents and quantity of the cargo at the time of "stuffing" at origin: 1. Container Security Initiative (CSI); 2. Customs Trade Partnership Against Terrorism (C-TPAT); 3. International Trade Data System (ITDS); 4. Automated Commercial Environment System (ACE); 5. E-Manifest; 6. SAFECON and TRUST program; and 7. Ten +Two Program.

U.S. involvement in technology development included attempts to develop sophisticated portal specialized radiation detection scanning equipment, a container security device (CSD), and new container construction.

SCANNING

In response to U.S. legislation to scan 100% of all cargo containers before they reach the U.S. port, DHS and the

Department of Energy (DOE) established the requisite pilot effort at several foreign ports under the Secure Freight

Initiative (SFI) targeting in-bound containers for weapons of mass destruction (WMD) prior to loading. Objections by trading partners surfaced and were confirmed by the

Government Accounting Office (GAO). The scanning man- date resulted in decreased cooperation between the United

Container Security

Lead, Follow or

Get Out of the Way

By Dr. Jim Giermanski, Powers Global Holdings

Insights

Maritime Logistics Professional

Maritime Logistics Professional magazine is published six times annually.