The following is a list of concerns over the US '10+2' Proposal for Advance Trade Data Elements.

1. Giving a reduced data set as an AEO, for example, is of very limited appeal when we have to give the same data, or worse subtly different data sets, several times.

We would much prefer to give a single common set of data, to the US, the EU or anywhere else but just once. This could be achieved by using a web portal or similar. Is there any possibility that such a system could be made worldwide? Would the various trading blocs - especially the EU - be able to buy into this idea politically or are we going to see the usual ‘lines in the sand’ drawn by the respective trading blocs?

The whole basis of trade is set up to deal with a single data set moving, with the goods, from country to country. This seems to have escaped the notice of the authorities.

Since all signatories to WCO SAFE should be using a common data set the apparent disagreements are baffling. It’s not that we don’t want to give the data...just make it easy for us.

2. Who has the data? As usual, everything appears tuned to the freight forwarding community but shippers are better positioned to kick off the data collection activity. Key issues here are:

2.1. A single identifier to 'tag' a shipment so that the respective parties can add in data. The Global UCR has been bandied about for some years. Why do we need yet another unique reference number? Ordinary commercial practise already offers a unique ID (a de facto UCR?) in the form of the MAWB/HAWB or MBL/HBL combinations. Accepting that some work would be needed, why are we continually re-inventing the wheel?

2.2. Some shippers will be unable to provide the necessary data for a variety of reasons; inexperience and lack of resource being two of them. They will have to rely on the offices of their forwarder. This is fine but the option needs to be available for those shippers able to perform the activity to do so.

2.3. This is my best fit for the 12 US data elements and how the respective parties could furnish data. This pre-supposes an experienced shipper and is based on UK practises.

o Manufacturer name & address
o Seller name & address
o Buyer name & address
o Ship to name & address
o Country of origin for the goods
o Commodity HS number (6 digit level)

All these are readily available to the exporter prior to export, or should be. They are best provided by them or via an intermediary such as an agent.

o Importer of record number
o Consignee number
These may be available to the exporter, certainly to the agent in the transaction. Either party could provide the data, the agent is probably best. The contract between exporter and consignee/importer can cover the need for this information. It could be a requirement to be shown on export paperwork, for example.

o Container stuffing location
o Consolidator name & address
These are more readily available to the agent. They are best provided by them. Exporters who fully understand and control their agents activities should be able to verify this data if needed. Indeed, to have proper safe and secure control of their supply chain, exporters must know who consolidates their goods and where. Again a contract between the parties could require this information to be made available.

o Vessel stow plan
o Container status messages
These are realistically only available to the agent and/or vessel operator. They are best provided by them.

3. Also at this stage, ownership of the compliance responsibility needs to be rammed home.

In the UK at least, an importer or exporter of record may outsource all their logistical activities to agent. They may not outsource their compliance obligation however. This is poorly understood by business in general, outside the immediate area anyway. The implications of having an agent perform all activity, well or otherwise, without ultimate responsibility are also not always understood.

4. I have already alluded to the importance of forwarders in this data collection. Whilst there are many good forwarders there are as many poor ones, and the ability of good ones suffers when up against time constraints. This is, of course, the norm in the industry.

We also have to consider what data they get from consignors who really do not understand or appreciate the data requirement (i.e. many of them). How can a forwarder cover that gap?

Data is always prone to adaptation to what is available at the time, especially on airfreight. Do we honestly expect an agent to either delay a flight or risk losing a major customer because, for whatever reason, one of these data elements is unavailable? Experience shows that an agent will, often in good faith, make their best guess as to such data. This may be wholly accurate or wholly inaccurate.

5. Suppliers who do not have English as first language exacerbate these issues and may cause problems.

6. With the best will in the world an importer will sometimes use a different classification from the exporter. How is that discrepancy to be dealt with? What are the implications for security of such a 'misclassification'?

Highly technical products especially give rise to problems in this area.

How far back down the supply chain do CBP require manufacturer data? CBP appear to have stepped back by requiring just the name and address of the entity that last manufactures, assembles, produces or grows the imported commodity. However, without definitive confirmation of the requirement it remains a concern. CBP may still want to know the ultimate manufacturer of every component of every product imported into the US. This will present huge problems and difficulties for importers and exporters to acquire.

7. Finally there is the issue of delays arising from providing data, or whilst obtaining data, or even whilst CBP work out what the data is telling them.

The manufacturer, the exporter, the importer has most to lose. They are the ones whose goods are examined, refused, unloaded of just plain delayed. The commercial impact of 10+2 is great if it is unfocused in application. Costs, of overhead, inventory buffer stock, premium freight lanes, will all increase. Competitiveness, especially against in-country competitors, will be damaged. Credibility with customers and with the authorities may suffer. The list could go on but the thrust of the argument is clear.


Above all market forces will determine whether the costs and inconvenience of dealing with US companies is worthwhile. In general, the answer would still be yes but it impacts on the cost of doing business with the US and other markets may prove easier to deal with. The US will be extremely sensitive to this aspect of the impact of their controls. Whether they choose to do anything about it is another matter.

This post was produced by Mark Corby, Customs & Trade Compliance Manager for a leading multinational company, based in the United Kingdom.

Labels: freight forwarders, outsourcing, security, shippers

Over the last 12 months there have been various reports in the media about security lapses at airports. Last year at Charles de Gaulle airport, Paris, people were discovered airside with false or expired passes; this year at O'Hare airport in Chicago a similar example was uncovered. In the security arena more generally, only last month, it was revealed that illegal workers in the United Kingdom had acquired Security Industry Authority (SIA) identification badges and that some of these people were carrying out security duties at airports and maritime ports.

With incidents like these, how certain can we be that our supply chain is truly secure?

Shippers who seek to comply with security regimes (mandatory or voluntary) pay for the privilege. Security does not come cheaply and naturally no security system is complete without an independent audit and inspection of our premises. But is everyone getting the same level of audit and inspection?

Attending a recent UK aviation security training course (comparable to the new rules about to enter European law for example) I learned more than I expected and it made me think about those recent headlines I have just highlighted, and just how secure the supply chain is. Let me share some of the issues this course raised:

1. Prior to 2003 the U.K had over 10,000 known shippers when listed freight forwarders did the security audit of their clients. Then the system changed to ensure shippers had independent audits, and now there are only about 2,000. Shippers now have to pay the independent auditor whereas before many forwarders did it for free or built the costs into their prices. Now, many freight forwarders charge between 7 and 9 pence a kilo (€0.05) on their freight invoice to cover their supposed costs of security.

2. Regular airfreight flying on cargo-only aircraft can only come from an account consignor; to be an account consignor one must provide financial information on your company. Knowing how wary companies can be about divulging such information, I would be surprised if many willingly give this information away lightly. You don’t get asked for this information if you are a "known consignor/shipper" and your cargo can fly on any aircraft. Would it not be better, therefore to be a known consignor rather than an account consignor?

3. All freight has to become "known" to fly on an aircraft: the rules are slightly different for freight flying in passenger aircraft than for all-cargo aircraft, but nevertheless this is the case. If you are not a 'known consignor' then the forwarder makes your freight known by scanning or screening it: but how do we know this actually happens? My suspicion was aroused when a colleague (a shipper) told me his company had sent a large machine by air: it was too big to be screened or scanned so sniffer dogs were used to check it and make it known; nothing to worry about here except for the fact that this was not the first of such shipments to have been shipped by air and they had not encountered the use of sniffer dogs before. So how had previous shipments been made known?

4. It is a legal requirement in the UK for 5 year pre-employment checks to be performed on all personnel who come into contact with known cargo; similarly everyone must have aviation security training, delivered in English by an authorised trainer. Dealing with the training issue first, it is not uncommon to come across drivers in the UK whose grasp of English is not sufficient for them to have understood security training given in English. With regard to the pre-employment checks for drivers, I have similar concerns that these may not be happening as required by the law, especially if one considers that drivers are employed to drive any freight – not solely export air freight that has been made secure (i.e. known cargo). I see the same drivers which pick up and deliver import freight (not known cargo) used to pick up and collect known cargo. Is it really true that all of them have been vetted and received the necessary security training?

The system needs policing. Yet of concern to me is the low number of inspectors available to check all the listed freight forwarders (or 'registered agents' as they are becoming known as today). Again using the UK as the example with which I am familiar, there are 60 or more independent auditors who check shippers, which equates to approximately one auditor to 33 shippers: compare this to the 6 Department of Transport inspectors employed to police the regulated agents. Even accounting for the fact that the DfT website only lists one entry per company (not per site) on its list of regulated agents, it still suggests perhaps 1 inspector to 100 or more agents. Is this really sufficient to inspire confidence that the regulated agents are properly being monitored and policed?

One solution would be to open up the auditing of registered agents to independent authorised auditors whose reputation hangs on the doing a professional job or else they might lose it. This would allow the officials to focus on policing the system.

Shippers are paying for the security of their products irrespective of being known or not. I remain unconvinced that the rest of the industry is necessarily taking their corporate responsibility as seriously.

So is our supply chain secure? I have my doubts. There is a strong lesson to be learned by all countries introducing tighter aviation security regulations for cargo; make sure sufficient resources are available to monitor and police compliance. I hope we learn this lesson quickly and not the hard way from a serious and tragic security breach.

This blog has been written by a former shipper and now an advisor in logistics and supply chain security. Due to the sensitive nature of the topic, the author has decided to remain anonymous.

Labels: air freight, security