Trust and Certify

Addressing last month’s Western Cargo Conference, Customs Commissioner Alan Bersin said some surprising things. To his credit, Bersin admitted, as the trade community has long felt, that Customs doesn’t see brokers and forwarders as trusted partners and that things had to change for the better. Although a welcome admission, it was stunning to hear him say the trade community equates trade facilitation with reduced inspections.

Here’s the reality: The trade community wants Customs to do its job, but to do it smartly, and to take quick action to overcome the lack of communication when issues need resolution. Not returning phone calls, ignoring e-mails and routinely citing Title 19, Section 1499 of the U.S. Code as the reason for a detention have never been acceptable to brokers and forwarders, yet that’s all part of Customs’ continuing MO.

That said, Bersin’s mention of bringing a key legal case to conclusion was well-received. Lizzarraga v. United States, Slip Op. 10-113, involved an attempt by San Diego Customs to revoke a broker’s filer code, his three-digit entry prefix. The case is notable for many reasons, most importantly because there was neither legal nor factual basis for Customs’ actions. Yet Customs barreled forward. Lizzarraga and the brokerage community took on the fight, and Customs lost at every turn.

Given the ultimate disposition of the case against Customs was dictated by a confession of judgment prepared and filed by the agency, one wonders whether any meaningful oversight was occurring within the agency or at the Justice Department. Because the case is almost finalized, the major remaining question is whether meaningful disciplinary action will be taken against the Customs employees who wasted significant taxpayer dollars pursuing a case that had no merit.

If Customs expects the trade community to take the agency seriously when it comes to building better partnerships with stakeholders, there should be consequences when such significant action is taken without a shred of legal or factual underpinning.

During his WESCCON remarks, Bersin also proposed that brokers be turned into “trusted certifiers,” but didn’t explain further. Rather, he talked about the concept as akin to when a lawyer decides whether to put a witness on the stand at a trial or hearing. Because he’s still new to the job, Bersin can be forgiven if he doesn’t fully understand the role of a customs broker, so let’s imagine how such a certifying function might work.

Let’s start with the obvious: The broker can’t certify the total accuracy of a set of documents connected to the contents of a shipment. Even the couriers who control the process from beginning to end can’t be expected to be guarantors of the goods or the related paperwork. Brokers rarely see the cargo, much less have the ability to inspect it, so the “trusted certifier” concept must revolve around something else.

How about this: Customs needs a force multiplier that allows it to work more closely with small and medium-sized companies, those that, according to industry estimates, account for some 70 percent of all U.S. imports. Why not develop a certification program for brokers, perhaps in partnership with the National Customs Brokers and Forwarders Association of America. Whatever the criteria — a test at the end or a passing grade — those who make the cut would be trusted certifiers. But then what? What’s their role?

It seems logical that, as trusted certifiers, brokers would visit with their customers, review their operations, processes and procedures, and certify the overall outcome amounts to reasonable care — that is, the importer’s operations lead to the correct classification, value and admissibility declarations at time of entry. Small importers often are located in the same area as their brokers. If not, many small and regional brokers have relationships with colleagues in other parts of the country they could rely on to certify their importers.

But what role does the broker play if he finds a deficient operation? He can’t be forced to notify Customs about those deficiencies without undermining the importer-broker relationship.

Let’s suppose the program’s structure is clear and some of these issues can be overcome. What are the benefits? The only real benefit any importer wants is to get its goods released quickly, for them to be delivered to the end-user on time and at the cost expected. What benefits is Customs prepared to offer to convince importers the certification process is viable or appealing?

So, what does Customs have in mind? And, given the Obama administration’s National Export Initiative, how does Customs plan to engage forwarders in the export process?

Finally, let’s tie up the last loose end regarding brokers. Let’s suppose Customs works out the program with the NCBFAA, the certification course is concluded and the individual is a trusted certifier. Let’s also presume importers see tangible benefits, are willing to incur the cost and want to go through the process with their customs broker.

Given all that, what happens if a noncompliant shipment arrives? We know Customs will seize it or take other appropriate action. Is Customs prepared to grant the trusted certifier immunity from liability?

So, tell us, Mr. Bersin: How do you see this trusted-certifier concept working?

Susan Kohn Ross is an international trade attorney with Mitchell Silberberg & Knupp in Los Angeles. Contact her at

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