10+2: Not readyfor prime time

10+2: Not readyfor prime time

"CBP needs to withdraw this proposal"

The JoC began an earlier column with this quote from the American Association of Exporters and Importers regarding Customs and Border Protection's recent notice of proposed rule-making for the Advanced Trade Data Initiative - or 10+2. Yes, we said it, and we believe it.

This column comes with a simple request to our industry friends and colleagues from the AAEI's supply-chain, security and trade compliance professionals: Please take a serious look at what's in and not in this proposed rule-making, and ask what this really will do to enhance U.S. economic and homeland security, and how it will affect real-world operations of your company or industry.

To correct apparent misunderstandings voiced by promoters of the proposal, let's get something out on the table concerning 10+2: The AAEI has not attempted and will not attempt to "derail" implementation of advanced trade data collection, analysis and application for risk management.

We do not, and have not, rejected or tried to overturn the Safe Port Act's carefully targeted call for high-risk maritime cargo targeting. We simply want the solution to be designed to do the job intended, and to work.

Regrettably, we believe that this 10+2 rule-making is simply too flawed to go forward. This doesn't mean that the vital work on homeland security can be shelved or that we don't appreciate the work and dedication of Department of Homeland Security and Customs professionals, for we do.

Like many industry groups, think-tanks and policy organizations, the AAEI has offered substantive recommendations and solutions to 10+2 problems from Day One. Our 38-page filing on March 17 contained literally hundreds of solutions, suggestions and recommendations, including a call for continued focus on two "building block" issues that we have strongly advocated for well over two years. Some of us, privately, refer to them as: (1) "Look before you leap!" and (2) "This soup is still frozen."

First among the building-block issues is "Look": The Safe Ports Act's call for a real-world cost-benefit and feasibility analysis requires a thorough inquiry extending across the supply chain. This is essential. Despite Customs' best intentions, the study appears to be so poorly conceived and limited in execution as to be virtually inconsequential in investigating, analyzing and assessing the economic impact of the proposed rule-making.

Second, the "implementation" data gathered by Customs is insufficient, which means that neither Customs nor we have any reassurance that the supply-chain product is feasible. Simply put, Customs needs to conduct a formal pilot program or its practical equivalent to verify that the eventual rule is feasible, beneficial and not economically disruptive; that it accomplishes its original intention to target "high-risk" cargo; and that it can "grow into its job."

Multiple industries raised serious questions about this proposed rule-making. Here are just a few that need serious and substantive answers:

-- Does the rule-making realistically achieve Section 203's specific goals for security of high-risk maritime cargo while enhancing vital homeland and economic security?

-- Do the entirely new and unanticipated bond-requirement liabilities in the rule-making make economic or homeland security sense?

-- Does this system provide practical, useful and even highly beneficial data for all concerned?

The AAEI believes the answer to these questions, and many more opportunities for important progress to be made in fulfilling the requirements of the Safe Ports Act, is no.

Would rapid application of this specific rule-making really help divert the wave of anti-competitive, trade-limiting and seemingly impractical or even counterproductive provisions already in the policy processes? Can this stave off or even delay another 100 percent-scanning requirement, and the highly burdensome - and counterproductive - provisions being proposed? The AAEI hopes so, but believes this is highly unlikely.

We believe all of us in this industry need to rise off our collective posteriors and launch an aggressive educational campaign. We are an essential, complex industry whose multiple roles are little understood in the legislative policy world or even among some of the federal offices involved in our business. Come on in! The water's very cold, but it's only going to get colder unless we act together.

Hallock Northcott is president and chief executive of the American Association of Exporters and Importers. He can be contacted at hnorthcott@aaei.org.