Changing Trade Environment Generates Interest at CBP Trade Symposium

At a time when trade news is in the headlines almost daily, U.S. Customs and Border Protection’s Trade Symposium, held in Atlanta, on August 14-15, drew a record number of attendees from near and far.  More than 1,100 members of the trade community flocked to the event.

“There’s a heightened interest because of all of the changes,” said Katrina Chang, a trade and customs advisor to Kim & Chang, the largest law firm in South Korea, who traveled all the way from Seoul to attend. “Many businesses are very concerned about the U.S. tariffs and they are hungry for information.”

The two-day event at the Atlanta Marriott Marquis opened with a conversation with CBP Commissioner Kevin McAleenan, who was interviewed by Elizabeth Merritt, managing director of cargo services for Airlines for America.  The commissioner spoke on a wide range of subjects including the new trade remedies. “We’re the implementer of new policies on the trade side. So we have been working very hard to explain how this works in practice in terms of changing a tariff or making a tariff rate quota, and putting that in place,” said McAleenan to a packed audience. 

“Our job is to implement the trade remedies timely and some of these timelines are very aggressive. They change because we’re responding to negotiations or because of policy determinations, and we’ve seen a significant impact,” he said. “We’ve collected $2.5 billion combined from Section 201, Section 232, and now Section 301 remedies. Washing machines, steel and aluminum, and Chinese trade practices are being pressed with different aspects of our trade enforcement regime.”

McAleenan also spoke about some of his priorities—recruiting, hiring, and sustaining a top quality workforce and accelerating the deployment of innovative technologies.  He also talked about challenges the agency is facing. The exponential increase of shipments as a result of e-commerce ranked high. “We doubled small shipments from 300 million to 600 million parcels in one fiscal year,” he said. “We’re trying to catch up with how quickly these supply chains are moving through our system.”

But as he noted, international mail facilities are the same as they were five years ago. “They have not changed,” he said. “We have modified our staff and we have retrained canines for new threats coming through. We’re also working on the technology side, but we’ve still got a lot of work to do.”

CBP has made progress in obtaining advanced data from the U.S. Postal Service for targeting purposes. “In the last 18 months, we’ve had more development in getting advanced data than the prior decade,” said McAleenan. “We’re up over 50 percent from China, which changed the game significantly.”

Next on the agenda, Executive Assistant Commissioner Brenda Smith of CBP’s Office of Trade gave an update on the agency’s trade strategy. “We are focusing on priorities within four major lanes within our overarching mission to provide trade security, trade enforcement, and trade facilitation,” explained Smith, who highlighted a number of accomplishments.  Among them is quantifying the benefits of CBP’s single window cargo processing system, the Automated Commercial Environment or ACE.

“I am happy to share with you that our calculations indicate that in fiscal year 2017, the streamlining processes that we implemented in ACE saved over 1 million hours for the government and the trade, which we value at over $400 million,” said Smith. “We are on track to meet or surpass those figures this fiscal year. And while we hit a milestone with ACE in February, by completing the last of the major scheduled deployments, we know our work is not over. We’ve received $30 million in additional ACE funding and started scheduling those enhancements to increase functionality and efficiency for both the government and the trade.”

Another key accomplishment is CBP’s implementation of the Enforce and Protect Act, which has proven to be a successful approach to investigating largescale duty evasion schemes.  “In just two years, we have initiated 20 Enforce and Protect Act investigations, conducted 18 foreign on-site verifications, and prevented the evasion of more than $50 million annually in antidumping and countervailing duties” said Smith.

The agenda also featured keynote addresses by Department of Homeland Security Secretary Kristjen Nielsen and Deputy U.S. Trade Representative Jeff Gerrish.  Secretary Nielsen spoke about creating a collective defense cybersecurity strategy. “Many of you oversee global supply chains, so you must not only secure your networks, but work with your customers, suppliers, vendors, and even other governments to ensure that someone else’s insecurity is not an entry point for a debilitating attack on your system. Do you know where your weakest link is? Spend time looking across your environment, across your chain to ensure that everyone is taking measures that they need to mitigate the threat,” said Nielsen. “Whether you’re an importer, exporter, broker, or business owner make cyber security a top priority.”

Among the many sessions that the symposium featured was a panel discussion on the opportunities and challenges of an evolving trade landscape. “If you look back 30 or 40 years, or actually you go back to just the post-World War II period, the U.S. over the decades has set in place a wonderful global trade environment that depends on free trade,” said Earl Comstock, director of the Department of Commerce’s Office of Policy and Strategic Planning. “The challenge we’re facing now is a lot of these countries that want to become a part of this system, particularly in the last couple of decades, don’t necessarily play by the same set of rules that we set up that system to work under. So it is a challenging environment.”

Another general session focused on global trade enforcement. One of the areas discussed was forced labor. “Goods that are produced in a foreign country with forced labor, forced child labor or convict labor are prohibited from being imported into the United States. They can’t enter the country,” said Jerry Malmo, director of commercial fraud at CBP’s Office of Trade.  “Our challenge is not knowing a lot of times where the goods are being produced, the actual manufacturer or producer, and whether or not those goods are actually imported into the United States. What we found is having an attaché, a customs presence in those countries, is really critical to engaging with the supply chain and the actors that really know what’s going on in those countries.”

Attendees also had a chance to hear from CBP’s senior leadership during a Town Hall-style panel. John Wagner, deputy executive assistant commissioner of CBP’s Office of Field Operations, spoke about expanding public-private partnerships. “These are critical for us. Long gone are the days where we just come out and say, ‘Here’s what you’ve got to do. You’ve got to follow these rules or you’re going to be penalized or your goods will be seized,’” said Wagner. “We have to build these solutions together. We cannot go it alone. We have to come up with innovative ways to do this.”

A number of breakout sessions were held on the second day of the Trade Symposium. One of the panel discussions focused on emerging technologies. “We’re advancing an entire portfolio of technologies and capabilities that are going to help us work smarter,” said Deborah Augustin, executive director of CBP’s Trade Remedy Law Enforcement Directorate, who moderated the panel. “We have this massive amount of data and information. So what does that really mean for us in terms of what we know and what we’re learning? The objective of today’s panel is to really provoke some thinking on how innovations such as artificial intelligence are driving changes to our business process.”

One of the most popular breakout sessions was a rare opportunity for attendees to meet one-on-one with the directors of CBP’s Centers of Excellence and Expertise. All 10 of the industry-specific centers, now operationally responsible for processing the country’s imports, were represented.  “I’ve seen a tremendous interest. Just opening up dialogue seems to excite the trade community,” said Dina Amato, director of the Agriculture & Prepared Products Center in Miami.

Case in point is Thomas Behr, the director of global trade development at two Atlanta-based companies, CP Kelco and Huber Engineered Materials, manufacturers of food ingredients and specialty chemicals respectively. “We wanted to put a face to the Centers,” said Behr. “It was an opportunity to do a meet and greet because we haven’t had any interaction with the Centers. Until 20 minutes ago, we didn’t even know which Centers we were in. So this has given us a path forward to make sure we’re establishing and opening lines of communication.”    

Others who attended the symposium also found this year’s event worthwhile. “I’ve been coming to the Trade Symposium for the last seven years and I’ve always enjoyed hearing the updates in terms of CBP’s priorities and strategic initiatives,” said Lisa Schulte, senior director of global trade services at Target.  “But in these challenging times, this challenging trade environment, it’s now more important than ever that we have a strong partnership between the trade and customs to work collectively to address the issues we’re both facing to make sure that we don’t slow down the supply chain.”