Trade Facilitation Agreement, e-Commerce Among Top Issues for WCO Nominee Hinojosa

With the World Customs Organization positioned to take a major role in implementation of the Trade Facilitation Agreement (TFA), the U.S. would benefit by having representation in a policy-making position at the WCO, said Ana Hinojosa, CBP's nominee for a leadership position at the intergovernmental body, in a recent interview. Hinojosa also pointed to the development of e-commerce and risk management policies as among the major issues expected to come up at the WCO in the near future. Hinojosa, now CBP deputy assistant commissioner in the Office of International Affairs, was nominated by CBP Commissioner Gil Kerlikowske earlier this year to be WCO director, Compliance and Facilitation (see 1501210015).

Part of the WCO's work on the TFA will be to make sure some underdeveloped countries are able to reap the benefits of the agreement, she said. Hinojosa said she doesn't think the U.S. "has all the answers" and it's important to look to other customs agencies that may be better examples for other countries. It will also be important for it to "get ahead of some trends," she said. The e-commerce world is a burgeoning space and Hinojosa is especially interested in the economic effects on customs bodies, said Hinojosa. As e-commerce expands and there's more use of express carriers, there will be a "significant impact" on developing countries that "are extremely reliant on revenue collection and value-added tax collection" because there are different "regulatory abilities" when compared to traditional commercial shipments, she said.

While Hinojosa's election is unlikely to mean major differences to the day-to-day world of those in the industry, there's potential for some meaningful changes in the long-term, said John Brew, a lawyer with Crowell & Moring who sometimes handles WCO issues. Improvements to customs operations in underdeveloped countries seems to be a likely area of focus for Hinojosa, he said. For example, there's a number of difficulties in dealing with the customs regimes that collect big chunks of revenue for smaller countries, some of which confusingly use third-parties to handle customs collections and enforcement, he said. Hinojosa may seek to improve those type of deficiencies as regional FTAs are implemented, he said.

The 179 member countries that make up the WCO will vote for several positions on June 13, and new leaders of the three directorates -- Tariff and Trade Affairs, Capacity Building, and Compliance and Facilitation -- will be decided that day, said Hinojosa. The Compliance and Facilitation directorate, the largest of the three, oversees the operational aspects of regulatory enforcement, she said. That includes "building risk management principles" and working to ensure import safety for pharmaceuticals, among other things, said Hinojosa.

Each director gets to "set the agenda for the discussions," suggest themes and bring in subject matter experts, she said. A U.S. representative would allow it to "showcase some innovation" and provide some facilitation best practices that have worked in America, she said. For example, many countries are expanding the role of customs regimes to handle border patrol aspects, she said. The U.S. experience in overseeing that dual-role will be useful "to help guide the direction that the members go in," she said. Also, some customs regimes have trouble understanding the idea behind the trusted trader programs, so there will need to be continued educational outreach to show that not every shipment needs examination in order to manage risk, she said.

While Kerlikowske could have nominated Hinojosa, who will face nominees from Germany and France in the election, for any of the three director positions, the move toward the Compliance and Facilitation post was a strategic decision, she said. Agency leadership considered all of the positions and looked at "where we might stand a stronger chance at winning," she said. The last CBP nominee, Sandra Bell, lost an election for the same director position in 2010. Notably, currently there are no women in elected leadership roles at the WCO and Hinojosa is the only female nominee, she said. That's pertinent considering that gender equality is among the WCO's current initiatives, said Hinojosa.

The WCO post is a 5-year term and would require moving to Brussels, where the WCO is headquartered, she said. Hinojosa joined CBP in 1987, becoming an import specialist in Laredo, Texas and San Diego, later conducting NAFTA verifications and then moving her way up to her current position in the Office of International Affairs. The "very foundational experience of learning down to how to classify and how to appraise the goods and how to apply free trade agreements" has prepared Hinojosa well for the WCO, she said. If elected, Hinojosa would succeed China's Zhu Gaozhang.