Mr. Chairman, thank you for convening this important hearing, and thank you and your trade staff for collaborating so closely with our side of the aisle on this hearing and customs reauthorization legislation.  I hope that we will move together to pass legislation this year.  Customs issues can be technical and difficult to understand, but they are the “nuts and bolts” of trade and are vital to our competitiveness, security, and safety.

U.S. Customs and Border Protection and U.S. Immigration and Customs Enforcement play pivotal roles in helping to ensure that our trade agreements, preference programs, and U.S. trade laws are enforced and that legitimate trade is facilitated.  I want to thank the many dedicated men and women at CBP and ICE for working tirelessly to ensure our security and safety and support trade.  The Treasury Department also plays an important role in furthering CBP’s trade mission.  I am pleased that Treasury is testifying today because we depend on it to oversee CBP’s important customs revenue functions.

Over the years, the volume and complexity of trade and challenges such as protecting U.S. intellectual property rights and consumer safety have grown, making the trade missions of CBP and ICE even more critical.  Yet CBP’s trade mission has suffered.  Today we will explore how it should be re-prioritized and also could be made to more effectively work in tandem with CBP’s important cargo security mission.  These are mutually reinforcing goals.

I want to explore five key topics today:

• The first is what is needed to ensure the success of CBP’s computer systems – ACE and ITDS – to improve how CBP and other agencies with import requirements process goods and collect and use trade data.  CBP must deliver more timely and meaningful capabilities with the most “bang for the buck” for the trade community and all agencies involved in the import process.  These two systems can help leverage limited agency resources, especially given tight budget realities.
• A second area of focus today is how advance cargo security data initiatives like “10+2” and programs like C-TPAT can enhance security and also better facilitate legitimate trade.  Companies that partner with CBP and make investments to increase cargo security and trade compliance should enjoy trade facilitation or other benefits to create incentives for greater cooperation.
• A third focus is whether the concept of “account management” offers a new model to manage the import process and facilitate legitimate trade, as compared to CBP’s largely shipment-by-shipment approach today.  Given limited resources to handle the large volume of trade, we must use more risk-based tools to regulate the import process, targeting high-risk situations and facilitating low-risk ones.  Account management approaches offer a lot of potential, and I look forward to hearing about ongoing efforts in this area.
• A fourth area of focus today is whether the organizational structures, policies, and operations of CBP and ICE adequately support their trade and customs enforcement missions. 
• A fifth focus today relates to CBP and ICE challenges in the collection of revenues, including antidumping and countervailing duties, and the enforcement of U.S. trade and other laws, such as relating to U.S. IP rights, import safety, and textiles.  Any issues that hinder these agencies’ efforts should be identified and any possible solutions explored.

In addition to these five key areas, customs reauthorization legislation should address other important issues, such as drawback simplification, which would help support U.S. manufacturing and exports and create American jobs.

I also want to emphasize that CBP’s consultations with the Committee, other agencies, and the private sector on its rulemakings and other majkor actions simply must be more systematic and meaningful.  The strong legal, policy, and process concerns raised by a range of CBP rulemakings and other major actions in recent years – such as “First Sale,” “10+2,” uniform rules of origin, and switchblade knives – illustrate the point.

Lastly, I want to point out that our trade agreements create important rules that benefit us and facilitate legitimate trade.  These provisions improve the security of supply chains and U.S. ports of entry and protect U.S. IP rights and the safety of imports.  Without these new rules, our companies, farmers, and workers are at a disadvantage.  These are yet more reasons to move ahead on the three pending trade agreements to the benefit of all Americans.

I want to conclude by encouraging CBP, ICE, Treasury, and the entire trade community to continue to share ideas with us to further facilitate legitimate trade in a safe and secure environment, including through reauthorization legislation.  I was very disappointed to see that the United States ranks only 18th in terms of the countries that best facilitate imports and exports across their borders, according to The World Bank’s Doing Business 2010 report.  There is absolutely no reason for this, and today marks our first effort since 2006 to fix this problem and create the dynamism that leads to more jobs.

Thank you, Mr. Chairman.

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