E-commerce Growth, Risks Akin to Those Associated With Social Media, McAleenan Says

The recent scrutiny of social media platforms like Facebook should be seen as a cautionary model for the regulators watching the rapid growth of e-commerce, CBP Commissioner Kevin McAleenan said during a speech at the U.S. Chamber of Commerce during a May 22 event. "I think the recent developments in social media and the oversight of social media provide some context I think we should reflect on," he said. For e-commerce, as with Facebook, "the relevant regulators have to be cognizant of the potential risks that such expansion brings," he said.

As the e-commerce "business model has evolved, so have the potential threats," McAleenan said. "There are digital venues that enable the direct shipment of small packages to retailers and consumers eager to find that great deal who instead may receive counterfeit items such as brake pads, air bags, cosmetics or pharmaceuticals." The growth in e-commerce is overwhelming on many levels. One industry member told McAleenan recently that not enough cargo aircraft are being manufactured to keep up with the growing demand over the coming decades, he said. "That growth has placed a strain on CBP's resources at our air, land and sea ports around the country."

CBP will need to make internal changes, he said. "Our risk management practices can no longer focus on traditional shipping methods," he said. "We must expand those practices to address the extraordinary flow of goods from new unknown and often less experienced importers. CBP will use data analytics and an array of powerful resources at our National Targeting Center and forward deploy to our ports of entry." CBP, along with the Department of Homeland Security, will ask for industry's help in developing technology for detecting small amounts of synthetic opioids, he said. CBP will also develop a "portal containing a database on importers that CBP has vetted and which are trusted," he said. "Think of it as a resource library that will let the public report potential trade violations."

CBP recently visited Amazon headquarters with customs regimes from the United Kingdom, Australia, Canada and New Zealand, he said. "It's a dialog we need to continue, with eBay, with Alibaba, with major retailers." There also are opportunities for collaboration with other agencies, and CBP will look into "implementing additional mutual assistance agreements, communicating our enforcement priorities to coordinate special operations and working with nontraditional partners, such as state and local governments as part of our e-commerce strategy." CBP released its e-commerce strategic plan earlier this year (see 1803060038). McAleenan will also take up this discussion with the World Customs Organization, which will consider e-commerce issues at a meeting in June (see 1805040018).

McAleenan also discussed CBP's efforts to stop imports of products made with forced labor. "To date, we've detained 57 shipments of goods suspected of association with forced labor," he said. That includes goods covered by Withhold Release Orders, the most recent one issued May 18 on cotton from Turkmenistan (see 1805210028) and products thought to be made with the involvement of North Korean laborers, he said. The Countering America’s Adversaries Through Sanctions Act requires CBP to treat goods made by North Koreans as made through forced labor.