Lack of Unique Identifiers Limiting Value of Trusted Trader Programs, CBP's McAleenan Says

A lack of clarity on "a unique identifier for supply chain operators crossing borders" is limiting the potential for trusted trader programs internationally, CBP Acting Commissioner Kevin McAleenan said during a May 17 speech at the U.S. Chamber of Commerce Global Supply Chain Summit. "We've been working so hard to recognize Authorized Economic Operator programs globally with partners, we've entered into Mutual Recognition Agreements, we're intending to expand them," but "they are not having dramatic operational value for our trade partnership," he said. McAleenan has been pushing to standardize unique identifiers (see 1612020024).

The unique identifier issue is "a solvable problem," he said. "If one international organization can issue IP addresses to everyone who signs up a new device on the internet, we can probably figure out a unique identifier in a way to translate that across data solutions," he said. The use of blockchain technology, a type of digital ledger, is another potential tool for improving supply chains, he said. Those are issues that McAleenan plans to discuss with the World Customs Organization in July, he said.

There have been very clear and bipartisan signals from the White House and Capitol Hill that "the trade enforcement of a level playing field is a central operational mission focus" for CBP, but at the same time, "we have to continue pursuing the full potential" of ACE and the Single Window, he said. "Just because we have a single window and the data is coming through, that's only the start," he said. "To make that commitment real, it's using it operationally, giving consistent answers from the whole U.S. federal response to the trade as their goods cross our borders and we've got more work to do on that area."

Indications so far seem to signal that CBP will play a big role in trade discussions going forward, McAleenan said. He pointed to the inclusion of CBP Executive Assistant Commissioner Brenda Smith at a White House executive order signing ceremony (see 1703310037) as evidence of CBP's involvement on major issues. "I think that's a very good sign of the understanding of our role," he said. "I would hope to carry that through in trade agreement negotiations" for operational and enforcement aspects, "whether its NAFTA or any other bilateral agreements that come up," he said.

While CBP has not "been at the table" in past trade negotiations, McAleenan thinks the agency will be involved in NAFTA talks regarding "border opportunities" and the "import/export communities' requirements" in these processes. That would also be a chance to discuss "how critical it is to improve our facilitation operation" and not backtrack on progress made from high-level economic dialogues with Mexico and Canada, McAleenan said. President Donald Trump nominated McAleenan to be CBP commissioner in March (see 1703310040).

CBP also remains "committed" to finishing rules for the Air Cargo Advance Screening program that's been in the works for several years (see 1611020027), McAleenan said. "The regulation is drafted and ready for review" but CBP is working through how it fits with the February executive order that requires the repeal of two regulations for each new "significant" regulation (see 1702070048), he said. That requirement doesn't apply to regulations that have "a national security basis, which we believe ACAS does," McAleenan said. "We are going to get ACAS over the line, I can promise you that."

Growing attention is being paid to e-commerce issues, including "how to recognize Section 321 challenges for customs brokers," McAleenan said. There's also an "emerging policy divergence in the supply chain around de minimis" internationally that creates a challenge for improving trade processing of e-commerce shipments, McAleenan said. While the U.S. recently increased its de minimis value threshold to $800, "that's not how our partner governments are pursuing it," he said. The EU is talking about reducing its de minimis level to zero to "enhance visibility" and Canada and Mexico seem likely to maintain their $20 and $50 levels, respectively, he said. "The supply chain wants harmonization, wants predictability and wants speed, so when you have divergence of policies, that's a major challenge," McAleenan said. That's "something we can tackle together with the right data, at the right time," he said.