AMBIGUITY FOGS DESTINY OF CARGO MANIFEST DISCLOSURE

AMBIGUITY FOGS DESTINY OF CARGO MANIFEST DISCLOSURE

A standoff between two camps over whether the information in air cargo manifests should be disclosed to the public appears as rigid as ever, but legislation this year could break the dead bock, congressional staffers say.

Airlines that carry cargo oppose releasing the data, saying it's confidential business information that could aid terrorists if released. U.S. Customs is also against disclosure.Pushing for release of the information are companies with branded merchandise, which want to use manifest information to track and combat imports of unauthorized, or ''gray market'' goods.

They are joined by companies that sell import and export data, like the Port Import/Export Reporting Service (Piers), which is owned by The Journal of Commerce.

All manifests are required to be filed with the government. Manifests contain data about the importer, exporter, carrier, goods, origin, destination and other information. Customs already discloses manifest information for oceangoing cargo, but not for truck or rail.

Groups representing manufacturers and distributors of trademarked goods say that an anti-counterfeiting bill passed by Congress in 1996 mandated that Customs release air cargo information. But Customs, supported by the air carriers, has refused to release the information, pointing to a legislative ambiguity it says must be cleared up by Congress first.

A Senate aid, who did not wish to be identified, said that the Senate Finance Committee, which oversees Customs, is looking at the issue and will likely take some action this year.

''This is an issue where the law was obviously clear and Customs chose an interpretation that was at odds with Congress's intent,'' he said.

All sides have made their positions fairly clear.

Companies represented by the International Anticounterfeiting Coalition (IAC) and the Coalition to Protect the Integrity of American Trademarks (Copiat) see the data as a key tool in combating unauthorized imports of their products.

Manufacturers of recognized brand name products such as Kodak, Chanel and Seiko say they lose millions of dollars every year through the sale of counterfeited and ''gray market'' goods.

Gray market goods are authentic brand name products made for distribution in a foreign country that are diverted by middlemen to the United States.

The manufacturers initially sell the products at favorable prices in order to encourage growth of sales in non-U.S. markets. Instead of selling it in the intended market, the intermediary introduces it into the U.S. market at a lower retail price, preempting sales the original company would have made.

PRACTICE NOT ILLEGAL

The practice is not illegal, but represents a breach of contract. Air manifest data would give manufacturers access to the names of firms shipping the gray market goods, which they claim are often the same firms that traffic in counterfeit goods.

Airlines see the matter differently. They believe that releasing details of what is carried in the belly of an aircraft would facilitate terrorism and pilfering. Even though air manifest details don't have to be filed for 30 days after the plane has flown, releasing them would make information about regular shipments of hazardous or high-value goods available, the air carriers say.

''We are opposed to the (anticounterfeiting) bill, based on anti-terrorist and security concerns,'' said Diana Cronan, spokeswoman for the Air Transport Association.

The International Air Transport Association, based in Geneva, has a more bald attitude.

''The position, so far as the airlines are concerned, is quite straightforward. The airlines themselves need cargo manifest information because they need to know what they are transporting,'' Phil Sims, IATA's director of Cargo Services, said in an e-mail in response to this reporter's questions.

''They (airlines) supply this manifest information because Customs needs to know. No other party needs to know - despite the fact that they would like to.''

Some in favor of releasing the information suggest that Customs may be reluctant to disclose air manifests because it would reveal large inaccuracies in the information filed. More than half of outbound aircraft manifests were found to be inaccurate in a survey conducted jointly by U.S. Customs and IATA in 1997.

However, a U.S. Customs official, who refused identification, said that 15 years ago Customs proposed releasing air manifest information, but that it had been shot down by the air carriers.

In any case, there is no immediate sign that the dispute will be resolved outside Congressional intervention.

At the heart of the dispute are a few key words in the legislative language of two 1996 laws, both of which amended the 1930 Tariff Act.

One of them, the Anticounterfeiting Consumer Protection Act of 1996, added the phrase ''vessel or aircraft'' in front of the word ''manifest'', adding aircraft to the list of modes for which manifest data has to be made public.

However, Customs argues that a ''statutory ambiguity'' was created by the other bill, the Miscellaneous Trade and Technical Corrections Act of 1996, passed later that year.

That bill amends the same section of the Tariff Act by striking ''such manifest'' and inserting ''a vessel manifest.'' That suggested that Customs did not, in fact, have to disclose aircraft manifest data.

In a Feb. 1 letter to a law firm representing Piers, Samuel H. Banks, deputy commissioner of U.S. Customs, said the dispute was a matter for Congress to resolve.

'STATUTORY AMBIGUITY'

''Both the Department (of the Treasury) and Customs believe that a statutory ambiguity has been created as a result of both of these amendments,'' the letter stated. ''In view of this ambiguity, Customs will not implement any regulations nor make aircraft manifest information available until such ambiguity has been clarified by Congress.''

None of the interests pushing for disclosure have gone to the courts to try and force Customs to release the data.

One official representing the anti-counterfeiting interests said their plan is to negotiate a compromise with Customs in a friendly context, rather than adopting a combative approach.

Two bills up for debate in Congress this year - a trade bill and a Customs authorization bill - could possibly act as a vehicle to clarify the situation, other sources say.

Meanwhile, former Customs commissioner George Weise, now a Washington, D.C.-based attorney and consultant specializing in customs and trade issues, has become involved.

As Commissioner, he urged Congress to resolve the ambiguity, and is now talking to the IAC about a possible resolution.

''Before we have too many public battles the best thing is to engage in a constructive dialogue,'' Mr. Weise said in a telephone interview. ''But obviously there are legal issues - there clearly is at least a question mark raised on that legal point.''