The new year marks the start of the European Union’s version of the 24-hour advance manifest container security rule, making this a good point to look at the divergent paths cargo security regulation has taken in the U.S. and Europe in the decade since the September 11 attacks.
The multilayered U.S. approach has involved the 24-hour rule, C-TPAT, 10+2, the deployment of radiation scanners and a law on the books requiring 100 percent foreign screening of U.S.-bound containers by 2012. Yet the new EU-24 hour rule is the first such effort from Brussels to address container security. And even then, it’s halfhearted — it’s so flawed as to negate most benefits for security. Yet it imposes significant burdens on shippers who must cope with earlier cutoff times for cargo delivered to Chinese and other ports where vessels load goods bound for Europe.
A few examples tell a tale of two systems. When U.S. Customs implemented the 24-hour advance manifest rule less than a year after the September 11 attacks, there was little question that for the strategy to work, non-vessel-operating common carriers would have to file their house bills of lading alongside the carrier’s overall manifest, including NVO master bills. After all, what good for targeting purposes is an entry on a ship manifest showing NVO Kuehne + Nagel, for example, as both the shipping and receiving party for a particular container? K+N as a responsible forwarder may know its customer and is probably careful about accepting freight from unknown parties. But from a targeting perspective, there’s a massive visibility gap if the underlying shipper and consignee are unknown to customs authorities.
That’s why the U.S. in its original 24-hour rule required NVOs to file their house bills independently, imposing an additional layer of regulatory burden on NVOs beyond the requirement that carrier manifests be transmitted 24 hours prior to vessel loading at the foreign port.
The EU chose not to go this route. The EU 24-hour rule, or EU-24, like its U.S. counterpart, requires carriers to submit the manifest 24 hours prior to commencement of vessel loading. But no separate filing requirement was imposed on NVOs — even though they control some 60 to 70 percent of all inbound container cargo into Europe. That’s a higher percentage than in the U.S., where NVOs have been expanding their presence but still control less than 30 percent of inbound container cargo.
How can you have effective cargo security screening without knowing the actual shipper and receiver?
A related issue involves the cargo’s destination. Unless the container is moving under a carrier-issued through bill of lading — a minority of Europe-bound containers — screeners won’t know the ultimate destination of a shipment. If the container arrives at Bremerhaven but will move over land to Berlin, this fact doesn’t figure into the risk assessment.
To be fair, the U.S. 24-hour rule also didn’t provide the destination unless the cargo was moving under a carrier through bill of lading. The U.S. closed this gap in the 10+2 importer security filing rule that took effect in 2010. That rule requires the “ship to” name and address as one of the 10 data elements that all importers are required to file to U.S. Customs.
The EU-24 rule has other quirks that appear to undermine its value in improving security. One is that the risk assessment on each container is performed by the customs agency in the country representing the first inbound European port of call, regardless of the destination. That means Malta, with a small customs staff, will perform risk assessments on thousands of containers that happen to call at its port in a transshipment call. Does Malta have the resources to do an adequate job?
And Malta, like each of the 27 other EU member states, will decide for itself how to implement the rule.
So why did the EU wait nearly a decade to impose a container security rule and then enact a regime so full of holes and questions? Officials with knowledge about the EU approach have several explanations. The EU has a basic aversion to playing “follow the leader” to the U.S., some say. Others say security is only part of the point: EU-24 is a Brussels-led policy within a broader agenda to further integrate Europe.
The EU is not the United States of Europe but rather a group of sovereign nation-states. Having seen its share of wars and acts of terrorism throughout its history, it is more accustomed to violence than the relatively unscathed U.S.
None of that takes away from an unmistakable conclusion: When it comes to container security, the U.S. got it right.