by M. Sigmund Shapiro
December 12, 2003
At a recent trade symposium conducted by the U. S. Bureau of
Customs and Homeland Security, Commissioner Bonner explained in
great detail the recently announced "smart container" initiative. By
utilizing more secure unremovable seals, and installing sensors
inside the container, Customs feels more confident that, along with
other profile information supplied by the importer, there is less
chance of chemical or biological weapons being introduced into the
country. The initiative will be rolled out within the next few
months with the hope that the process will become the norm.
Customs told the audience that importers joining this effort
would benefit by minimizing the need for physical examination of
many of their shipments. No doubt it will, since Customs would by
and large bypass these "secure" containers. I raised a question with
Deputy Commissioner Browning as to whether this change of focus
would increase the possibility of entry hanky-panky with regard to
classification, valuation or quota status.
Coincidentally, a recent article in a trade publication
concerning the In-Bond process, underscored demonstrated the
complexity of two programs.. Customs is, in a word, "in a box".
Customs tried a few years ago to attack the In Bond process after
former Commissioner Von Raab attempted to eliminate it entirely.
There were meetings. There was a Straw Man proposal that was quickly
blown away. There followed a creaking Tin Man modification, but like
the Cowardly Lion, the attempt receded from view, with only minor
computer enhancements. Essentially In Bond remains a manual process.
Importers demanded that In Bond survive. And survive it must in
several areas.
1. Master In Bond-the movement of a ship’s entire cargo from a
seaport to the interior U.S. is essential to the mini-landbridge
operation.
2. Movement of individual container goods transiting the U.S. for
shipment abroad is an integral part of international trade.
Neither of these procedures can be eliminated without causing
havoc in commerce across the U.S.
Other In Bond techniques however lend themselves to possible
modification. For example, people seeking to delay duty payment
until the goods reach their doorstep will benefit from the monthly
duty payment deferrals and might find In Bond to be less useful.
Importers seeking to defer duty and tax payments until after the
goods are withdrawn from bonded warehouses in interior ports could
be accommodated with examination of the cargo at the first port of
arrival.
The issue of goods going "around the flagpole" instead of being
exported across land borders becomes a smuggling issue and should be
treated accordingly.
So the two issues, in bond and cargo security are intertwined,
and seem to lead to more, not less container examinations. It
appears only a matter of time that Customs might order examination
of all In Bond shipments with the exception of Master In Bond. This
would seem to be overkill.
Customs concerns for security would, in part, be satisfied with a
nationwide "smart box" process. The enterprising smuggler or "misclassifier",
using a "smart box" could elude Customs scrutiny whether or not In
Bond was utilized. Customs says that other intelligence they glean
from invoices, inquiries, the parties to the transactions and past
history will give them a profile. But if an invoice from a regular
shipper to a regular receiver shows non-quota goods and the box
contains quota goods…?
It seems to me that, as "smart" boxes take hold, Customs will
have to be smarter, without disrupting normal commerce.
