COSTLY CUSTOMS MANDATE

THE U.S. CUSTOMS SERVICE is proceeding relentlessly toward its goal of completely automating its operations. Customs Commissioner William von Raab reported recently that customs will soon be operating in a paperless environment in which all international trade documents are filedelectronically. His message to port authorities, ocean carriers, customhouse brokers and other trade-related firms is automate or perish."

Customs is a key link in international trade. Cargo crossing U.S. borders must be cleared by customs. If the commissioner of customs decrees that the documents involved in moving cargo must be filed and processed electronically, the trade community has no choice but to follow his orders.However, this mandate will be costly to carry out. It is already creating serious questions in the trade community. Must all transportation companies and customhouse brokers invest in costly computer equipment? To assist their tenants in the filing of customs documents, and in the process speed up cargo flow across their wharves, some ports are establishing service centers for the transmission of documents. Smaller brokers and importers that can't or choose not to invest in computer equipment can file their documents in paper form at the service center, and the port will process the information and relay it to customs electronically .

In a recent visit to the port of Los Angeles, Mr. Von Raab had special praise for New Orleans, Norfolk, Charleston and other ports that are setting up service centers. He also had special criticism for ports such as Los Angeles and Long Beach that are not rushing to establish service centers. Possibly Mr. von Raab correctly analyzed the reason for the hesitation on the part of the Southern California ports: With so much Pacific Rim cargo moving through the region, the competitive pressures are not so great that Los Angeles and Long Beach feel a need to automate.

Port officials in Southern California take another view of the situation. Larger brokers in the region have already automated, and probably would not make use of a port service center if it existed. As customs proceeds with its efforts to automate all transactions with the trade community, a market may well be created in Southern California for a service center to satisfy the computer needs of smaller brokers and importers. However, it is not necessary that the ports establish such a center.

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