Issue 400, May 12, 2003
In recent months, Customs field operations personnel have been issuing Requests for Information (CF-28s) to obtain information on supply chain security from companies not yet a part of the Customs-Trade Partnership Against Terrorism (C-TPAT). Members of the trade community, including the Joint Industry Group, the American Association of Exporters and Importers and the U.S. Business Alliance for Customs Modernization, vociferously opposed this new development.

In a letter to U.S. Customs, these groups argued that Customs should not use formal Requests for Information to collect information sought under a voluntary program like C-TPAT, and that while the Office of Management and Budget has approved the use of CF-28s to collect information relating to the classification and appraisement of merchandise, it has not approved the use of CF-28s to collect information relating to supply chain security.

On March 19, 2003, Jayson Ahern, Customs Assistant Commissioner of Field Operations, issued a response letter, pointing out that despite reports to the contrary, these CF 28s fell short of a standard, full-blown C-TPAT questionnaire. Addressing concerns that responses on security issues might be used to determine the admissibility of merchandise, Ahern responded that weak security procedures would not change the status of otherwise admissible merchandise. However, he stated that along with commercial compliance, security has necessarily become a factor in determining which shipments may be examined upon entry into the United States, and that there seems to be a strong correlation between C-TPAT membership and high commercial compliance rates.

Nonetheless, Ahern further stated that Customs had collected a sufficient number of responses to such CF-28s, from both C-TPAT participants and others, to conduct a high-level analysis of any links between supply chain security procedures and the frequency of trade discrepancies. As a result, he stated that Customs would direct its field offices to discontinue the practice of issuing CF-28s for the purpose of obtaining information on supply chain security for non-C-TPAT members.

This change in practice was confirmed at the April 4, 2003 meeting of the Treasury Advisory Committee on Customs Commercial Operations (COAC). Customs officials there also confirmed that, to the extent certain companies may not yet have responded to CF-28s seeking supply chain security information, orders have been issued to Customs field directors not to seek responses.

Our contributing writers, Sarah M. Nappi and Charles F. De Jager, are trade attorneys at Miller & Chevalier Chartered in Washington DC and can be reached at snappi@milchev.com and cdejager@milchev.com respectively.

Please note that due to the complex nature of the subject matter, DHL Danzas Air & Ocean cannot be responsible for actions taken by the reader in reliance on the information contained herein without prior consultation with DHL Danzas Air & Ocean.