Hearing on Supporting Economic Growth and Job Creation through Customs Trade Modernization, Facilitation, and Enforcement
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Hearing on Supporting Economic Growth and Job Creation through Customs Trade Modernization, Facilitation, and Enforcement _________________________________________
HEARING BEFORE THE COMMITTEE ON WAYS AND MEANS U.S. HOUSE OF REPRESENTATIVES ONE HUNDRED TWELFTH CONGRESS SECOND SESSION |
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COMMITTEE ON WAYS AND MEANS |
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WALLY HERGER, California |
SANDER M. LEVIN, Michigan CHARLES B. RANGEL, New York FORTNEY PETE STARK, California JIM MCDERMOTT, Washington JOHN LEWIS, Georgia RICHARD E. NEAL, Massachusetts XAVIER BECERRA, California LLOYD DOGGETT, Texas MIKE THOMPSON, California JOHN B. LARSON, Connecticut EARL BLUMENAUER, Oregon RON KIND, Wisconsin BILL PASCRELL, JR., New Jersey SHELLEY BERKLEY, Nevada JOSEPH CROWLEY, New York |
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JENNIFER M. SAFAVIAN, Staff Director and General Counsel
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SUBCOMMITTEE ON TRADE |
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GEOFF DAVIS, Kentucky |
JIM MCDERMOTT, Washington RICHARD E. NEAL, Massachusetts LLOYD DOGGETT, Texas JOSEPH CROWLEY, New York JOHN B. LARSON, Connecticut |
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_______________________________
C O N T E N T S
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WITNESSES
Panel 1:
Mr. David Aguilar
Acting Commissioner, U.S. Customs and Border Protection, U.S. Department of Homeland Security
Testimony
Mr. Kumar Kibble
Deputy Director U.S. Immigration and Customs Enforcement, U.S. Department of Homeland Security
Testimony
Mr. Timothy Skud
Deputy Assistant Secretary for Tax, Trade and Tariff Policy, U.S. Department of the Treasury
Testimony
Panel 2:
Honorable George Weise
Executive Vice President, Sandler & Travis Trade Advisory Services, (former Commissioner of Customs). Testifying on his own behalf
Testimony
Mr. Darrell Sekin, Jr.
President and CEO, DJS International Services, and President, National Customs Brokers and Forwarders Association of America, Inc.
Testimony
Mr. Michael Mullen
Executive Director, Express Association of America
Testimony
Mr. John Williams
Executive Director, Southern Shrimp Alliance
Testimony
Mr. Karl Glassman
COO, Leggett & Platt, Inc.
Testimony
Hearing on Supporting Economic Growth and Job Creation through
Customs Trade Modernization, Facilitation, and Enforcement
U.S. House of Representatives,
Committee on Ways and Means,
Washington, D.C.
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The subcommittee met, pursuant to call, at 10:04 a.m., in Room 1100, Longworth House Office Building, Hon. Kevin Brady [chairman of the subcommittee] presiding.
[The advisory of the hearing follows:]
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Chairman Brady. Good morning, everyone. Our hearing today will focus on three critical aspects of the Customs mission: Modernization, streamlining or facilitation, and enforcement as well as the accurate, timely measurement of improvement in all three. I want to welcome everyone and extend a special welcome to our guests.
Just 100 years ago, the main function of Customs was revenue collection revenue. For over 125 years, Customs duties were our main source of funds. At that time, America’s imports were a mere $153 billion a year, and duties collected totaled about $310 million. Today the value of imported goods is approximately $2.3 trillion a year, and duties, taxes, and fees collected on these goods bring in almost $37 billion. The value of imports in 2011 has grown to over four times what it was just 20 years ago.
Trade is vital to our economic engine, creating jobs and lifting wages here at home. Today more than 50 million U.S. workers are employed by companies that engage in international trade, and U.S. trade represents over 30 percent of America’s economy.
In the 21st century, lowering tariff barriers and increasing quotas is not enough. Time is a trade barrier, and streamlining legal trade is an essential component to our competitiveness in the global marketplace. This hearing will explore how to allocate resources, develop the models, and measure progress so that we can move the ever‑increasing volume of legitimate trade more efficiently and halt trade that doesn’t comply with our laws.
Customs is the air filter to our economic engine, allowing good, clean imports to flow through, while the harmful elements are screened out before they cause damage. To develop better tools and measurements, I intend to move forward on a bipartisan basis to pass Customs reauthorization legislation this year. The last time this committee last passed a Customs bill was in 2004, and it is long overdue.
CBP and ICE play pivotal roles to ensure that our trade agreements, our preference programs, and U.S. trade laws are enforced. The Treasury Department also plays an important role in furthering CBP’s trade mission, and we depend on it to oversee CBP’s important Customs revenue functions.
I strongly believe that for the United States to remain competitive, we must have the most modern and automated Customs structure we can realistically develop, the first component of a sound Customs policy. I support the modernization of CBP’s Automated Commercial Environment, which is vital supporting increased imports and pre-screening of cargo. I hope the CBP has turned over a new leaf in making ACE a reality and will quickly operationalize the cargo release module that we have been awaiting for some time. I understand that ACE will soon be expanded to accommodate export processing, which today is partially an archaic paper process.
Complementing ACE is the International Trade Data System. In working with Treasury, CBP has been leading 48 agencies in developing ITDS so that our companies deal with an electronic and seamless one‑stop government, one window at the border instead of a morass of multiple clearance processes. These programs will allow CBP and other agencies to more quickly and cost‑effectively process imported goods and to more efficiently collect and use trade data.
Second, in addition to automation, the sophisticated nature of trade demands better streamlining of Customs processes, particularly for low‑risk importers. CBP’s advanced cargo data initiatives and industry partnership programs must work together to better facilitate legitimate trade. Companies that partner with CBP to improve trade compliance should realize the benefits of a more efficient system that create incentives for cooperation above the norm.
CBP has the potential to develop new models to facilitate legitimate trade in a risk‑based manner, such as through pooling expertise in Centers of Excellence and Expertise as well as the Importer’s Self‑Assessment program instead of shipment‑by‑shipment approaches. These models would enable CBP to focus on high‑risk imports and expedite low‑risk shipments while leveraging limited government resources. I would like to maximize the role of the Office of Trade in carrying out these functions.
The third component of sound Customs policy is collecting revenue, enforcing our laws without jeopardizing legitimate trade. While the great majority of incoming trade is materially compliant, CBP and ICE face increasing challenges as the sophistication of those who wish to evade our law increases. CBP and ICE have designated eight critical sectors as Priority Trade Issues to focus their enforcement resources, such as intellectual property rights enforcement, textiles, and antidumping countervailing duties.
I also want to congratulate fellow Ways and Means Committee member Dr. Charles Boustany on his bipartisan legislation to address evasion and underpayment of antidumping and countervailing duties, and I look forward to considering it.
We also can’t forget that our trade agreements beneficially create new obligations on our trading partners that increase compliance. The TPP negotiations are taking this several steps further.
In conclusion, I want to emphasize that CBP and ICE consultations with this committee, with other agencies, and the private sector on its rulemakings and other major actions must be systematic and meaningful. This hasn’t always been the case. There have been some bumps in the road in the past, and I think that consultation helps achieve a better product.
Today we will have a comprehensive discussion on efforts to enhance economic growth and job creation by facilitating legitimate trade modernizing Customs procedures, enforcing U.S. Customs and trade laws in preparation for moving Customs reauthorization legislation.
Chairman Brady. I will now gladly yield to our Ranking Member of the Trade Subcommittee, Mr. McDermott.
Mr. McDermott. Thank you, Mr. Brady. I want to thank the chairman for holding this meeting and thank our witnesses for coming today. I want to start by recognizing the tremendous challenge that the CBP faces and the acting commissioner, Mr. Aguilar. Previous commissioner appointee was not confirmed, and therefore, Mr. Aguilar is sitting in for him in one of those situations where you have the job but you don’t have the power, and we appreciate what you are going through at this point.
Your agency is tasked with protecting our borders from a range of security threats, a task that rightly became a central priority after 9/11. The agency also has to facilitate legitimate trade in goods across our borders, a task that is all the more complex given the exponential rise in trade.
Since Customs was subsumed in the Department of Homeland Security in 2002, our committee has expressed significant concern that CBP has not met this dual mandate and pushed CBP to sharpen its trade focus, both through statutory mandates and through oversight. Former Commissioner Bersin and now Commissioner Aguilar and key members of the CBP team have worked to respond to our concerns, and clearly you have made real progress, and we commend you for that.
But even with this progress, CBP is facing challenges with the trade side of the mandate. We are working our way towards Customs reauthorization bills, so we are here today to understand the nature and the origin of the problems and to look for solutions.
There are three areas that I hope we can focus on. One is bringing the U.S. Government’s system for processing imports into the 21st century. It is, after all, the 21st century. Ensuring the CBP, number two, is getting off the sidelines and fulfilling its obligations to stop foreign companies from evading our trade revenue laws; and, three, ensuring that CBP can partner with innovative companies to stop imports which undermine U.S. intellectual property.
On the development of CBP’s computer systems, the need is clear. We ought to get off paper and onto a computer. Our current system of processing imports is, simply put, inefficient. Importers submit duplicative data and paper documents to CBP and other regulatory agencies just to have their goods cleared at the port.
Now, I come from a high tech district, and just on the face of it, this redundant paper‑based system not only costs importers more time and money as they wait for goods to clear, but it also costs CBP and other agencies wasted time and money.
CBP’s mismanagement of ACE development hurt business. Our economy and Congress lost some faith in CBP to get the job done. Now I understand that in the past 2 years, CBP has taken good steps to get ACE back on track. Today I hope to get a better sense of how real that progress is and whether it is sufficient ‑‑ significant enough that the committee should support continued development of the ACE ITDS system. It is ‑‑ I think an electronic one‑stop system for importers would be a great trade facilitation benefit for businesses and over time could be a platform where CBP can finally automate a range of other programs such as drawback and inbound cargo.
On evasion of trade remedies laws, CBP’s failure to act, even when affected U.S. industries provide CBP with very specific information about evasion is simply unacceptable. The purpose of AD/CVD duties is to level an un-level playing field which is harming our companies. If CBP does not take adequate steps to collect these duties, CBP is allowing that harm to continue.
Finally, on protection of U.S. intellectual property, the administration, ICE, and CBP deserve credit for the work being done at the National IPR Center to target and stop infringing imports. There are two areas where CBP should partner with innovative companies to bolster this work. The first is effective implementation of a provision enacted as part of the National Defense Authorization Act to allow CBP to share details on products suspected of being fakes with the right holders. The second is giving CBP the authority to share illegal devices used to infringe on copyright works such as video games with right holders. I hope to work with the administration and the committee to address both of these issues, and we welcome your testimony. Thank you.
Chairman Brady. Thank you, Mr. McDermott. Now for our first panel of government witnesses, the Acting Commissioner of Customs and Border Protection, David Aguilar. Kumar Kibble, Deputy Director of Immigration and Customs Enforcement. Welcome. Timothy Skud, Deputy Assistant Secretary for Tax, Trade and Tariff Policy with the U.S. Department of Treasury. Gentlemen, thanks for coming today. We have reserved for each of you 5 minutes. Commissioner Aguilar.
STATEMENT OF DAVID AGUILAR, ACTING COMMISSIONER, UNITED STATES CUSTOMS AND BORDER PROTECTION, U.S. DEPARTMENT OF HOMELAND SECURITY
Mr. Aguilar. Good morning, Chairman Brady, Ranking Member McDermott, and distinguished members of the subcommittee. I want to begin this morning by thanking the members of the subcommittee and the Congress for your unwavering support to U.S. Customs and Border Protection and its men and women. Your support continues to enable us to work with our private sector partners to transform, do exactly as the chairman and the ranking member stated, to transform our entry and clearance processes, the way that we do business, and to meet our mutual and continuously evolving needs. It is indeed an honor this morning to appear before you today representing the thousands of men and women of the United States Customs and Border Protection.
I would like to begin to discuss the actions we are taking at CBP to develop a fully modern agency focused not only on protecting, which is critically important, but just as critically important also on promoting our national security and economic well‑being well into the 21st century. This is an exciting time of innovation and implementation, and I want to underline implementation, at CBP, and I, along with the men and women of CBP, are committed to continuing our partnerships with the trade industry and furthering our co‑creation efforts to enhance the many important initiatives that we have undertaken.
Last week CBP held its 2012 trade symposium, its first ever on the west coast, where we focused on many of the initiatives transforming the way that CBP approaches the trade operations with the trade community and especially with other government agencies. We are charged with some of the most critical parts of America’s economic and physical security.
In fiscal year 2011, CBP processed nearly $2.3 trillion in trade. We operate at 329 ports of entry and process over 100 million cars, buses, trucks, trains, vessels, and aircraft arriving at our ports of entry every year. We move more than 28 million commercial shipments arriving via air, sea, and land, 250 million more arriving in small parcels via express carriers and mail.
With such a large and growing volume of goods and people crossing our borders, CBP must perform its responsibilities efficiently to avoid delaying shipments or increasing costs and causing inefficiencies for U.S. businesses. It is essential that we stay agile in modernizing our processes and methodologies, especially as we face a world of increased trade volumes and the rapidly escalating complexity of modern trade.
Going forward, my focus on trade policy centers on several strategies and six key themes aimed at transforming as to how CBP carries out its trade and security missions. Specifically, those themes are consistency and harmonization; modernization of our processes and IT technology capabilities; building up the trust‑based programs that have been so successful; co‑creation with the trade industry on how we move forward; bidirectional education where we learn from the trade and the trade learns from us as to how we operate so that we can align, synergize, and dovetail at every opportunity; and lastly, trade enforcement and revenue collection, bringing substantive meaning to the enforcement and the revenue collection of our responsibilities.
Building a consistent approach across commercial ports and between Federal agencies will allow us to increase data sharing, reduce duplicative data filing, and reduce regulatory barriers to efficient cargo release. We have focused our efforts on the creation and implementation of things such as the Centers for Excellence and Expertise.
In October of 2011 CBP established two of these centers: One for pharmaceuticals, one for electronics. I recently announced just last week the expansion of two additional Centers for Excellence and Expertise, one in the petroleum, natural gas, and minerals arena, and the other in the automotive and aerospace arena. All four of these centers bring to bear all of our trade expertise on a single industry, on a single sector of industry in one strategic location. The centers are virtual, a mix of virtual and physical collocation that are staffed with trade disciplines and positions using our account management principles to authoritatively facilitate trade issues. Ultimately, they provide one‑stop processing to lower the trades cost of business and enhance CBP’s enforcement efforts.
Our most visible modernization effort is transition from ACS to ACE to automate and streamline the clearance and collection process. In March, we announced the completed development and successful deployment of ACE rail and sea manifest, capabilities to all direct arrival rail and seaports through ACE.
We are also seeing significant progress on our simplified entry cargo release program, which is another successful result of our co‑creation efforts. Approach to modernizing our trade operations is critical in co‑creation. Simplified entry provides importers with a chance to file earlier in the process with a streamlined filing which can be amended. This is a first‑time ever capability that has been provided to the trade industry.
Additionally, we continue to work towards establishing a comprehensive trusted trader program, specifically to strengthen co‑creative program such as the Air Cargo Advance Screening, C‑TPAT, and the Importer Self‑Assessment program. We are working closely with the other agencies that are so critical to our successes.
As we move forward, I think it is important to reiterate those themes. Our economy grows stronger when the way we do our job is more compatible with today’s business practices. Our partnership with the Congress, the trade community, and other government agencies is critical to strengthening our Nation’s economic prosperity and national security.
I thank the committee again for the opportunity to appear before you today, and I will look forward to continuing our work together, our partnership, and to answering any questions that you might have of us.
Chairman Brady. Great. Thank you, Commissioner.
[The statement of Mr. Aguilar follows:]
Chairman Brady. Mr. Kibble?
STATEMENT OF KUMAR KIBBLE, DEPUTY DIRECTOR, UNITED STATES IMMIGRATION AND CUSTOMS ENFORCEMENT, UNITED STATES DEPARTMENT OF HOMELAND SECURITY
Mr. Kibble. Chairman Brady, Ranking Member McDermott, and distinguished members of the subcommittee, it is my privilege to testify before you today regarding ICE’s investigative efforts and strategies to combat illegal trade practices and commercial fraud activities. As you know, the growth of international trade is an integral part of our Nation’s economic prosperity. It is imperative, therefore, that we protect American innovation and are attuned to any new threats to public safety and national security it may pose.
Today I will focus on three of our major priorities as an investigative agency: Protecting American innovation from theft, cracking down on complex international property theft, and strengthening our borders to combat the threat posed by transnational organized crime.
ICE’s Homeland Security investigations HSI Directorate is the largest investigative program within the Department of Homeland Security, with an extensive portfolio of enforcement authorities. Specifically, HSI investigates a wide range of trade fraud, including intellectual property theft and commercial fraud. Both IP theft and commercial fraud pose significant threats to the U.S. economy and health and safety of the American public. To focus government efforts and to enhance government efficiency, HSI led the creation of the National IPR Coordination Center. Now with 20 partners, including other Federal agencies, Europol, Interpol, and the governments of Mexico and Canada, the IPR Center brings together the full range of legal authorities and law enforcement tools to combat IP theft in the United States. And we are now seeing tremendous results.
In March of 2012 HSI and our partners at the FBI executed a joint enforcement operation which resulted in the arrests of 28 subjects, including two in Germany. These arrests were ultimately the result of a merger of an HSI investigation into a large‑scale counterfeit smuggling scheme and an FBI narcotics smuggling investigation. This investigation revealed this organization to be involved in a web of criminal activity, not only the smuggling of counterfeit merchandise and narcotics trafficking, but also the use of fictitious personal and stolen corporate identities to further those activities. The total estimated MSRP of seized goods that this organization attempted to smuggle was in excess of $300 million.
Overall, our IPR enforcement statistics have increased dramatically over the last 3 years. From fiscal years 2009 to 2011, arrests jumped 115 percent, indictments rose by 206 percent, and convictions are up a total of 77 percent. Thus far in this current fiscal year, our IP enforcement statistics indicate that we will again surpass this past year’s record results.
In October of 2007 ICE created Operation Guardian, which is the IPR Center’s public health and safety initiative. Examples of imports targeted as part of Operation Guardian are counterfeit toothpaste containing antifreeze, counterfeit prescription drugs, tainted pet food, counterfeit circuit breakers, and contaminated food products. Since its inception, more than 700 investigations have been initiated resulting in nearly 200 criminal arrests, over 260 indictments, 171 convictions, and more than 3200 seizures valued at over $87 million.
We recognize, however, that law enforcement cannot do it alone, and so we look to partner with private industry in our efforts. To enhance and facilitate productive partnerships with the public and private sectors, the IPR Center launched Operation Joint Venture in fiscal year 2008. It gives industry a point of contact they can use to provide us with leads and tips regarding efforts to combat intellectual property right infringement. Since July 2008 the IPR Center has coordinated and conducted 671 outreach events with approximately 35,000 public and private sector partners.
HSI also has a long history of engagement in commercial fraud enforcement, dating back to our past as investigators for the former U.S. Customs Service. HSI investigates U.S. importers, companies or other entities that attempt to circumvent lawful trade mechanisms, including the payment of required duties. The HSI antidumping and countervailing duty program is another illustration of how HSI, in close partnership with CBP, protect U.S. businesses from unfair trade practices and protect the revenue of the United States. The goal of an HSI antidumping or countervailing duty evasion investigation is to ensure that U.S. industry is protected against unfair trade practices and to ensure that the United States receives legally required tariff revenue. Currently HSI is involved in approximately 100 investigations relating to open commerce, AD/CVD orders covering commodities such as honey, saccharine, citric acid, tow‑behind lawn groomers, shrimp, steel, and wooden bedroom furniture. Textile imports represent approximately 43 percent of all duties collected by CBP, and Operation Unravel was conducted in fiscal year 2011 by HSI, CBP, and the government of Mexico’s Tax Administration Service, or SAT, to primarily target illicit textiles transshipment from China through the U.S. and ultimately into Mexico under suspected false NAFTA claims. The results of Operation Unravel are still being analyzed to identify additional vulnerabilities in the bonded movement system.
So we continue to work using other initiatives as well including targeting the vulnerability of in‑bond diversion with fraud investigative strike teams and have continued to build on our commercial fraud program, expanding our statistics are trending up. I want to thank you, again, for the opportunity to appear before you today, and I would be pleased to answer any questions you may have for me.
Chairman Brady. Thank you, Mr. Kibble.
[The statement of Mr. Kibble follows:]
Chairman Brady. Welcome, Mr. Skud.
Mr. Skud. Thank you, Mr. Chairman, Ranking Member McDermott.
Chairman Brady. Mr. Skud, can you hit that microphone again.
STATEMENT OF TIMOTHY SKUD, DEPUTY ASSISTANT SECRETARY FOR TAX, TRADE AND TARIFF POLICY, UNITED STATES DEPARTMENT OF THE TREASURY
Mr. Skud. Sorry. Thank you, Mr. Chairman. Ranking Member McDermott, members of the committee, thank you for the opportunity to discuss Treasury responsibilities for Customs revenue functions and to discuss the International Trade Data System. Authority for Customs revenue functions is important to the Treasury mission because taxation and regulation of trade have an important effect on our economy and on global growth. While enforcement of Customs revenue laws have been delegated to the Department of Homeland Security, Treasury retains sole authority to approve regulations. One recent example of such a regulation, Treasury and DHS have published a proposed regulation that would reform the in‑bond and transit processes. These reforms should enhance revenue collection, they should limit evasion of antidumping laws, and they should promote security by providing better control over in‑bond shipments.
We work closely with CBP on many areas of mutual concern. One of those areas and the focus of my testimony today is the International Trade Data System. It is a key component of efforts to modernize and coordinate interagency border enforcement activities. Today, importers report separately to numerous government agencies, sometimes on paper, sometimes electronically. Wouldn’t it make sense to have a single electronic filing with that data distributed by computer to all relevant agencies? That would reduce costs to government and to business. This is the ITDS vision that CBP and 46 other agencies are building as part of the ACE program.
Some ITDS functions are already operational. For several years ITDS agencies have been able to obtain import data that CBP already collects electronically and use that data to stop unsafe shipments and to eliminate paperwork requirements.
Two years ago, the ITDS board identified three priorities, on which I can report significant progress has been made. The first priority was to add data elements required by other agencies to the existing CBP reporting messages. CBP has built that capability. It is known as the PGA Message Set. CBP expects to test it this year.
The second priority. Accept electronically imaged forms in place of paper. CBP has built a document image system to accept imaged documents where paper is now required. CBP is testing this capability now.
Third, establish a technical standard for communication between agencies’ electronic systems. CBP has adopted interoperable Web services as a protocol for transferring data among agencies. It was successfully tested last year.
When these three initiatives become operational, CBP will have implemented for imports the basic electronic trade data interchange system mandated by the SAFE Port Act. Testing and implementation are planned for this year.
With progress on imports, we have begun work on exports. In 2010, the ITDS board recommended building ITDS export capability on existing systems in order to save money and time. CBP and the Census Bureau, which has authority for the current export commodity reporting systems, have agreed to expand those systems to include data required by other ITDS agencies. Despite the challenges involved in a project of wide scope and involving 47 agencies, the ITDS program can be successfully and expeditiously implemented. Our board of directors looks forward to working with this committee to make ITDS a success.
Mr. Chairman, that concludes my oral remarks. I am happy to answer questions, and I thank you for the opportunity to testify.
Chairman Brady. Mr. Skud, thanks for being here today.
[The statement of Mr. Skud follows:]
Chairman Brady. I thank all the panelists.
Mr. Aguilar, first, you know, in the past, CBP has not necessarily devoted much time to consultations with Congress, the trade community, trying to find as you would call it, co‑creation progress going forward. You and your predecessor have changed that culture, have spent a great deal of time with that outreach. I want to thank you for doing that, encourage you to do more of it. I think it is very helpful.
I have got two questions, one dealing with ACE, one with measurements. As you heard from Mr. McDermott, there is bipartisan support for getting ACE in place, and there is bipartisan concern about the delays and what the future is on that program. The reason it is critical ‑‑ you know, the Trade Subcommittee on Ways and Means have three major goals. One is to find new customers, level the playing field around the world for our American products and services; secondly, to fight protectionism, here and abroad, the delay becomes a barrier for our products to be sold around the world; and finally what we are doing today, which is streamlining the movement of these goods and services. Time is the trade barrier in the 21st century. ACE could be critical to creating more efficiently efficiency in that system.
My question to you is, looking forward over the next 12 months, which ACE functionalities can we expect CBP to deliver?
Mr. Aguilar. Mr. Chairman, as you said, ACE is absolutely critical. ACE, simply put, is going to modernize into the 21st century, is going to streamline, facilitate, and give us a greater capability at targeting illicit commodities and goods coming into this country.
Having said that, we have prioritized the ACE functionalities that we are looking at putting forward. Some of those include the going forth on the ITDS, as Mr. Skud pointed out, following through with our simplified entry that is already the force module, if you will, working towards full cargo release. Critically important that we move forward on those. Continuing our efforts to include the co‑creation of what all of the PGAs are looking for us to do. So one of the things that, of course, we are faced with are the budget constraints. But prioritizing what it is that we have in place that will dovetail with what the needs are going forward. Complete e‑manifest for rail and sea, simplified entry of the phase one, the document imaging system that we just talked about, the PGA Message Set, and the interoperability. Critically important. Moving forward, at or about the 12‑month period and continuing is going to be something that the trade has asked for specifically, which is the entry summary edits capability, and then of course working towards integration of the exports capability in support of the President’s export initiative.
Chairman Brady. So, Commissioner, in the first 12 months, which elements are you looking at?
Mr. Aguilar. It is going to be the ACE, continuing the rail and sea that is going through the pilot now, it is going to continue with the simplified entry that is basically moving forward as we speak, and commencing, already commenced a pilot on the exports initiative.
Now, as quickly as we can, because we have already allocated from carryover monies, is what we refer to as critical fixes on already deployed capabilities, and what that means, Mr. Chairman, this is something that is critically important to me, is going back to all of those deployments that we have deployed in the past that have not worked as well as they should have, as we planned them, and as we envisioned them. So we are going back to fix those to get them to work as they need to be operating.
Chairman Brady. Okay. I think there will probably be follow‑up questions on ACE. Let me ask a final question on measurement. We have two young boys. I have discovered that putting a bunch of 5‑year‑olds on a soccer field doesn’t necessarily mean you will see a soccer game, and creating a whole number of new programs and efficiencies doesn’t guarantee efficiency unless you measure it. So my question to you is, what measurements ‑‑ and I notice the World Bank study recently ranked America 9th in measuring the efficiency of our supply chain, in Customs efficiency we were ranked 13th in the world and international shipments 17th. We did better in some other areas such as tracking and tracing, consignments. The goal of this legislation is to move up those rankings. So, A, what are you measuring today in efficiency and accuracy and security? And as we move forward with ACE and others, what other measurements will you be looking at?
Mr. Aguilar. Yes, sir. Critically important that we take a look at the metrics, and for each one of these efforts that we are undertaking, we have identified a set of metrics. I would like to give you a couple on some of the things that are most prominent as an example on ACE. Some of the metrics that we are measuring is entry summary filers, and how that is progressing moving forward, entry summaries by the filers, how many are they actually conducting. Filer entry summary submissions to ACE, summaries that are submitted, the percent of eligible entry summaries that are filed in ACE, what percentage are we seeing in an increase, and I have got some numbers that I can provide to you later on if you would like, post‑summary correction submissions, something that the trade asked for, we provided, and now we are finding that they are using it tremendously. Validation activities under ACE.
I spoke earlier about our Centers of Excellence and Expertise. We piloted these just back in October of 2011, but moving forward on that, one of the things that we set in place was our ability to capture the metrics. I will just go through a couple of those to show the level of detail that we are going through. But under risk segmentation and facilitating the legitimate trade, some of the things that we are looking at, do the centers maintain or improve the revenue gap within the industry standards from the compliance standpoint? Do the centers maintain or improve compliance of the revenue within the industry standards? Are the centers increasing the paperless rate that we are also interested in? Do the centers improve the detection rate and increased seizures of high risk products? And there is a litany of about 15 metrics that we use. So for every one of these, undertaking these that we are moving forward on, we have a metrics unit that we are looking at for each one of them.
Chairman Brady. Right. If you could supply those to the committee, that would be helpful. Mr. Kibble and Mr. Skud as well, when you are looking at your respective duties, what you measure today and are contemplating, that would be very helpful to me as we move forward. I cede my time to Ranking Member McDermott.
Mr. McDermott. Thank you, Mr. Chairman. I am a physician. We are accustomed to talking over people’s heads and using all kinds of acronyms and all kinds of words that nobody uses in ordinary speech. So as I listen to you guys, I think I am talking to a bunch of doctors who are talking to a bunch of people that don’t know what you are talking about. ACE stands for automated commercial environment, whatever the heck that is.
Mr. Aguilar. Yes.
Mr. McDermott. We spent billions of dollars on it. And then they said, no, it isn’t working. And now we are doing something new, and that is going to work. Would you explain to me in terms that I can understand what it was that was attempted and what didn’t work? I mean, anybody here can answer. I don’t know who to direct that at, but if you could do that, I think it would help the committee understand what this reauthorization is about.
Mr. Aguilar. I will begin, and then I will pass it on to my fellow doctors here, sir.
We are moving towards an automated commercial environment that takes into account all the technological capabilities that basically exist in today’s world to ensure that we automate, that we connect all the dots of all the participating agencies, all the agencies that have an interest on all commodities coming into the United States. From a compliance, from a revenue perspective, from a security perspective, ACE is going to be that backbone that by way of technology, gives all of us the insight that we need to have to do the following things: And that is to facilitate, to streamline, to secure the global supply chain, and to specifically target. In the simplest terms, it will give us the means by which to assess risk, but critically important to, in a very modern way manage risk.
So now as ‑‑
Mr. McDermott. Could I just stop you there?
Mr. Aguilar. Yes, sir.
Mr. McDermott. It seems to me that if you are trying to work on risk that one of the best ways not to make a mistake is to not do anything, don’t let anything come in. So if you make the system so complicated that nothing can get through it, then you will never have any problem, nothing will ever have happened because it got into the country. Am I ‑‑
Mr. Aguilar. And that is exactly what the ACE system is not trying to do. It is going to give us the ability to segment risk, to assess the risk once it has been segmented, and then direct our efforts at that flow of goods and commodities that we either know less about or that we have reason to believe we need to target because of a high level of risk. Therefore, basically identifying the needle in the haystack, if you will, by blowing away all the hay of this $2.3 trillion worth of imports that we do on a yearly basis. So we have spent a lot of money on ACE, but I will brag on CBP over the last couple of years in that more has been done in the last 2 years in the ACE arena than had been done in the prior 5 years before that.
One of the things that we are looking at, Congressman, is building in what I refer to as chunks, functionalities, identifying the functionalities along with the trade community, and looking to what is best going to serve the trade community and CBP and the rest of the participating government agencies. Taking them in chunks, building business cases, and being incremental towards, as an example, cargo release, so that at the end, we have a fully functional cargo release capability that is built over a time period that takes into account the incremental necessity and importance of segmentation and risk identification.
Mr. McDermott. What are the other agencies? What is your feeling about this?
Mr. Kibble. Well, sir, I am a general practitioner, I am not a specialist. However, I would say ‑‑ and, I mean, this relates to ACE but also other initiatives that CBP leverages to selectively target. One of the things that we pioneered recently through the Commercial Fraud Working Group, which is a very close working group that involves leaders from both CBP and ICE, are post‑investigative analysis reports, and the idea here is from an investigative perspective, when we conclude the investigation, how do we take that tactical success and turn it into something that is of more strategic value?
Well, we identified methodologies, schemes, things that can be used to refine targeting algorithms at the National Targeting Center and other systems that CBP leverages to, again, focus in on the violators so that we can facilitate lawful trade.
So, I mean, that is just a general observation I have there is that we are partnering as we have never before, and not only with one another, but obviously with industry to refine the method in which we target illicit or suspect trade.
Mr. McDermott. Do you have any comment that you want to fill in anything?
Mr. Skud. Well, I will just add, Mr. McDermott, that there is sometimes a lot of confusion about what ITDS is, how is it different from ACE. Well, they are not two different systems. One system, ACE; ITDS is a part of ACE. The basic premise of ITDS is let’s use the Customs system, ACE, to collect information for these other agencies as well so we don’t build separate systems for each agency to collect it, and Customs stores it, gets it to the agencies, makes decisions about it, and then gets that information back to Customs.
Mr. McDermott. Is it seamless to you for countervailing duty decisions and so forth?
Mr. Skud. Well, I am afraid it is not seamless to me. The goal is to make it seamless to the trader so that he is filing one place, and he will get one answer back. I am afraid when you are trying to stitch together 68 agencies, there is a lot of seams in there, but we are focused on ‑‑ the ITDS program has been around for a while. For a long time, there was a lot of talk about all the wonderful things we could do. In the last few years we decided, look, it is time to concentrate on the basics. Let’s add the data, let’s get it to the agencies, let’s get those decisions back to Customs. So we are trying to concentrate on things we know we can build, things that can be built quickly and at relatively low cost.
Mr. McDermott. Thank you, Mr. Chairman, for extending my time.
Chairman Brady. No, thank you, sir. Mr. Davis.
Mr. Davis. Thank you, Mr. Chairman. I want to commend all of you and your agencies for moving them into the 21st century. There are ample models in the private sector with credit card architecture, online purchasing, similar relationships with an Amazon and a PayPal, for example, that make it transparent to that one user that literally links thousands of organizations together with very little error. I know this is tedious dealing with statutes and regulations, but having done many large company implementations myself, nothing to the scale that you all have, I feel your pain in that one sense, but it is very critical to progress.
It brings me to my first question. Commissioner Aguilar, as you know, CBP facilitates trade on behalf of 48 Federal agencies at our border, and according to the agencies announced initiatives for 21st century trade, you are also working to improve cargo security while increasing trade competitiveness. I have been told by a number of people, organizations in the trade community that highly compliant importers find the benefits of CBP’s partnership programs to be severely constrained by other agencies’ holds at the border, and it is my understanding these delays tend to be several days longer than CBP holds.
I have also been told that a multi‑agency partnership program for highly compliant importers or a certified importer program would greatly reduce these delays. I am thinking on the TSA side with Global Traveler, for example, if, so we avoid an inverse of Pareto’s law where 90 percent of the people, in effect, are punished for the suspicious behavior of maybe a very small percentage.
As trade continues to increase, especially with the recent entry into force of trade agreements with Korea and Colombia, how is CBP working with other Federal agencies to streamline legitimate trade processing, and how is your agency working with other agencies to provide benefits to trusted traders?
Finally, as kind of a third part to that, have you considered a multi‑agency certified importer program?
Mr. Aguilar. Yes, sir, all critically important questions. Let me begin with the last one first. On a multi‑agency trust‑based partnership, we are very aggressively working towards something that looks like that but, as Mr. Skud said, when you have 48 agencies coming together, all having different interests for the right reasons, whether it is statutory, regulatory, or otherwise, it is hard to do that. But we have made some great strides, I believe, in moving in that direction.
The one example that I will give in that venue is what we refer to as a Border Interagency Executive Committee that we created about a year ago that meets on a quarterly basis, and for the first time, brings together all of these interested agencies together at one table to start working towards that synergy, towards an alignment of interests in order to start identifying, as an example, what the PGA Message Set, what are the elements that we would need as one government to basically satisfy all 48 agencies at one time. We have created the Message Set. It had never been done before. So we are moving in that direction.
The issue of other government agency holds, approximately 60 percent of all holds placed on goods coming into the country are placed by other government agencies besides CBP. So when that happens, because we don’t have that one whole of government approach, that one single window, CBP acting as the executive agent then has to go to each individual agency to get the information required for them if they have a need for it, and to get the actual release. Very time consuming.
Moving towards ACE, that single portal at ITDS, to where all of the interested agencies come together in one window, one component, one location where all the interests, whether they are revenue, compliance, safety or otherwise, are targeted, if you will, under ACE, and then fed to the agencies electronically, very quickly get the feedback and released. That is what we are working towards as we move forward.
Mr. Davis. Well, that is a good point to transition over to Mr. Skud. How are you leading the 48 government agencies in the International Trade Data System to ensure that all involved in the import process are working together to harmonize their treatment of importers that participate in trusted shipper programs in the processing of their goods?
Mr. Skud. Well, the ITDS role is really focused on building the electronic platform to provide the information to the agencies to allow them to make that decision, those decisions based on the best information available quickly. Really, these kind of policy decisions about interagency cooperation, these are things that are done by the policy leadership in the Border Interagency Executive Committee. That is really where the focus for that is and not in ITDS.
Mr. Davis. Thank you, Mr. Chairman. I yield back.
Chairman Brady. Thank you. Mr. Reichert.
Mr. Reichert. Thank you, Mr. Chairman, and welcome to all three of you. I especially want to thank Mr. Aguilar and Mr. Kibble for your service and the men and women that serve in your agencies. I do appreciate your service, too, Mr. Skud, but I have a special spot in my heart for law enforcement, being an old sheriff myself, so I appreciate the work that all three of you do.
I can identify, as Mr. Davis said, a little bit with your pain, the sheriff’s office with 1100 employees in Seattle, we had responsibility for the metro system, so our challenge was to enforce the laws, investigate crime, and keep the buses and the trains moving, and sometimes cops really don’t understand the part about keeping the buses and the trains moving, am I right?
Mr. Aguilar. Exactly.
Mr. Reichert. I know you are working hard on that, so I understand that aspect of it as well.
I want to address my first question to Mr. Skud. Now, you said in your opening comments taxation and regulation of trade have an impact on our economy. That is, I think, a pretty mild comment. So I am really interested in your views on how U.S. policy is actually deterring goods from moving through our ports, specifically the harbor maintenance tax, and in Washington State, as you know, we have the Port of Tacoma and the Port of Seattle, and that harbor maintenance tax has created a situation where some of our world partners are now heading their ships to Vancouver, Canada, and Prince Rupert, and so we are losing some business in Seattle as a result of this tax, and it strikes me as a very clear cost advantage that U.S. policy is conferring on foreign ports. The fewer goods that are shipped through our ports obviously, the fewer jobs they sustain.
So do you agree that imposing this tax and how it is currently imposed on inbound marine cargo could discourage shipping through U.S. ports and harm our competitiveness? We like to think of ourselves in Seattle and in Tacoma as the Port of Chicago because we only keep about 30 percent of the goods that come into those ports, and 70 percent go across the country. Vancouver is quickly becoming the Port of Chicago, and we are concerned about that.
Mr. Skud. Well, Mr. Reichert, as a native‑born Seattleite and graduate of the University of Washington, I have some familiarity with the Port of Seattle and Port of Tacoma.
Mr. Reichert. Good to hear.
Mr. Skud. And under the current law, there is the harbor maintenance tax on shipments coming into U.S. ports, including those two ports, and to the extent that that raises costs on shipments to those ports vis‑à‑vis competing ports in Canada, I would have to agree that it provides an incentive for people on the margin to ship through another port.
Mr. Reichert. We see this as a pretty serious problem, as you might guess, in our area of the country. Would you commit to working with me on finding a solution to this problem?
Mr. Skud. I would be happy to work with your staff to address the issue.
Mr. Reichert. Great. Do you have any ideas today on how we might be able to do that or do you want to wait until another time?
Mr. Skud. I think I better wait.
Mr. Reichert. Okay. I appreciate your commitment, Mr. Skud. Thank you so much.
Mr. Aguilar, I have worked with Customs for a long time over my career on the issue of circumvention devices here in Congress, and, you know, this helps thieves pirate U.S. intellectual property, including many video games made in and around our congressional district by companies like Nintendo and Microsoft. It is my understanding that Customs will seize these devices but that you don’t share them with the affected U.S. companies. Do you have anything like Mr. Kibble described as a joint venture, private‑public relationship where you can share these things with our public companies so that they know what is happening when this technology is stolen?
Mr. Aguilar. Congressman, one of the things that has just come about, and we are very grateful, which will be a tremendous tool for us, is the IPR information sharing capability that we just issued the interim final rule on, and under that, what we now have the capability to do is that within 7 days of Customs, CBP seizing a commodity, we will go to the importer and ask them for evidence if we believe that it is counterfeit or is an IPR violation, a trademark violation, and they, of course, are more than welcome to provide us with some information to prove that it is not a violation.
After 7 days, we are now capable and very much willing to share with the rights holders the information, pictures, things of a commodity that we haven’t had in order for them to help us validate or verify that it is, in fact, a valid product, or that it is a violative product. So we have that capability in place.
Mr. Reichert. Thank you. Thank you, Mr. Chairman.
Chairman Brady. Thank you. Mr. Neal.
Mr. Neal. Thank you, Mr. Chairman. I have a company in my district that manufactures high quality knives and other types of tools, and I have visited with them a number of times, and they sell the tools in the U.S. and as well as internationally. They have been in business for over 100 years, and they employ 100 people in Southbridge, Massachusetts, it is Hyde Tools. They suggested that the procedures for filing an antidumping action should be made more accessible to small and medium‑sized enterprises. They tell me they were forced out of the U.S. market for a particular tool that was dumped by a foreign company, but they didn’t file an antidumping case because, as a small business, they couldn’t afford the expense.
For the witnesses here, would you care to suggest a path forward, making it easier for these small business types to file antidumping actions?
Mr. Skud. We are all here on sort of the other end of the collecting the money side, but I would be happy to work with your staff to connect them with the right people at the Department of Commerce who work on the input side, the filing side.
Mr. Neal. Okay.
Mr. Aguilar. Congressman, I would add to that that one of the things that was actually put in place because of some of these concerns is what we refer to as e‑allegations where when there is a belief or there is an incident where a company or individuals or an industry believe that something is happening in the IPR environment, by way of virtual connectivity to CBP through e‑allegations, they can commence that effort also.
Mr. Neal. Okay. Let me follow up with you, Commissioner, as well. Coming from a State where there is a great deal of chip manufacturing and also the acknowledgment that there are millions of counterfeit chips that are imported into the United States, I am told that these chips have been found in many critical applications, military weapons, voltage regulators for the automobile antilock braking and air bag systems.
You mentioned in your testimony that last month, your agency published an interim final rule that reflects new authority that permits Customs to share prior seizure, and also photographs of suspected counterfeits with trademark holders to assist your organization in determining whether or not the goods are counterfeit. Can you provide the committee with any additional information on that?
Mr. Aguilar. Other than that we are now taking those actions, we have that capability, we welcome that capability, and it will help us tremendously in making determinations as to whether the products that we have seized are, in fact, violative by being able to share that information, that product, that picture, things of that nature with the copyrights holder. A tremendous tool.
Mr. Neal. Thank you. And lastly, one of the witnesses on the next panel who is the COO of Leggett & Platt, they have a presence in Oxford, Massachusetts, in my constituency. In their testimony they estimate that Treasury loses well over a billion dollars in unpaid duties each year. That is a pretty significant number. As a cosponsor of the ENFORCE Act, this bill would help to create a formal process for stakeholders to petition Customs to investigate possible evasion, and I hope, Chairman Brady, that we can consider this legislation as well, and for all the witnesses, what might you suggest along that path?
Mr. Aguilar. As to the pending bill, I think ‑‑ I don’t want to speak for my fellow doctors here, but I think we would all welcome the opportunity to assess and to work with the Congress on any bills going forward, absolutely.
Mr. Neal. Given that Boston port is the equivalent of open heart surgery as you know.
I thank the panelists, Mr. Chairman.
Chairman Brady. Thank you, Mr. Neal.
Mr. Herger.
Mr. Herger. Thank you, Mr. Chairman.
Commissioner Aguilar, I understand that membership levels for CBP’s two partnership programs, the importer’s self‑assessment C‑TPAT have leveled off. In fact, ISA membership hasn’t budged since 2007 when the program was started and about 200 companies joined. The ISA was meant to incentivize better compliance.
If a company opens its books and demonstrates trade compliance, CBPs will offer tangible benefits, but industry reports that it doesn’t find the benefits to be material. What kinds of material benefits can we provide especially for smaller‑ and medium‑sized companies?
Mr. Aguilar. A couple of things on that question. The two top trust‑based partnerships that we have are, in fact, ISA and C‑TPAT. C‑TPAT is over 10,250 members now. It has grown dramatically. The ISA has, in fact, stabilized, and last week that was one of the main focuses that we had at our trade symposium. Identifying the benefits. ISA is compliance program, C‑TPAT is a security program. We are very seriously taking a look at melding the two as one so that the benefits that are derived from both will be a package, if you will. Everything from front‑of‑the‑line benefits, the reduction in inspections or examinations. As an example, C‑TPAT members right now are seven times less likely than a non member to get inspected or examined. The number of audits under the ISA that occur will be reduced.
So those are the incentives that we are looking to package up as one trust‑based program. We are working with the trade industry to see what other benefits we might be able to jointly identify.
There are other efforts underway that I hesitate to share with you in this venue only because we are still working on them, but very quickly, I would anticipate within the next 60‑90 days, we will be able to share some of the incentive areas that we are looking at within ISA because it is a critically important program.
Mr. Herger. Thank you. It sounds like you agree that this is important to measure the outcomes of this program for C‑TPAT members, such as clearance times, not only to ensure efficiency but also to encourage greater participation in the program.
Mr. Aguilar. Absolutely. Congressman, I would add the following because I feel it is critically important. Under our C‑TPAT program, there have been two studies by the University of Virginia where both studies have shown, this is an assessment on the participants, that the members have found it very beneficial from both the benefits’ perspective and improvement perspective on their business processes when they join C‑TPAT.
Mr. Herger. Again, one of the defining points I think would be that we have more members joining, and I think there is a concern that we haven’t had more. So that is important we work on that.
Also I was hoping you could go into more detail on the Centers for Excellence and Expertise, CEEs. What were the outcome from the two pilot centers in California and New York? What benefits did they provide to the trade community and to CBP.
Mr. Aguilar. I have to tell you, Congressman, this is something we love to talk about, and the reason for it is because of the immediate outcomes were very depictive of our vision for the CEEs and actually went beyond. The vision was standardization, consistency, bringing more transparency to that industry sector that we are dealing with, and driving a more compliant and facilitative process.
As an example I will give you the following. On the request for information, the so‑called CF 28s that are filed at ports of entry when a commodity or product is coming in, there are members of the industry that will actually come in through several ports, 60, 70, 80 of the 329 ports. In the past, the way we used to work, each port would have the ability, and we would exercise that ability and enforcement right, to ask for a request for information. That would place a hold on the shipment. Under the Centers of Excellence and Expertise, there will be one request per information as opposed to 60, 70 or several other ports of origination. There will be one response.
So it makes a tremendous difference on facilitation, on the streamlining. It brings together, the CEEs bring together all the disciplines within CBP in one centralized location as opposed to the fragmented means that we operate under currently. When we finish off the CEE’s effort, we have identified ‑‑ at this point in the time, we have identified nine industries where we believe Centers of Excellence and Expertise will apply.
We have announced automotive and aerospace, we have announced pharmaceutical, electronics, and petroleum, natural gas and minerals. We are looking to go towards agriculture, base metals and machinery, consumer products, and mass merchandisers, industrial and manufacturing materials, textiles, wearing apparel, and footwear as we move forward.
So each one of those will have that ability to standardize and bring more consistency and harmony as to how we do business and be more facilitative.
Mr. Herger. Thank you. Thank you, Commissioner.
Chairman Brady. Can you forward us the list of those future CEEs.
Mr. Aguilar. The ones that are being contemplated, yes, sir, absolutely.
Chairman Brady. Mr. Buchanan.
Mr. Buchanan. Thank you, Mr. Chairman. I want to thank all of our witnesses for being here today. I just wanted to mention one thing, quickly. I did get a chance to get down to El Paso, met with Customs and Border Protection. They were telling me out of the four ports of entry there, 21 million people northbound a year. Very impressive. I was very impressed in terms of the professionalism and just staggered by the amount of work that the people do there in your organization.
But I wanted ‑‑ I mentioned this a little bit earlier, Commissioner, and I touched base with you. Let me run through this. Sarasota Bradenton International Airport, which is about an hour south of Tampa, maybe 50 minutes south of Tampa International Airport, is a user‑fee airport, and has one dedicated CBP officer stationed there. Sarasota pays all the costs of the officer presently. No commercial International carriers are landing there today, so that there is no need to clear Sarasota airport. So the single officer clears primarily general aviation. Also, we have a port in my area, in terms of Port Manatee, they work closely with the port.
In 2005, when Sarasota last had a Canadian commercial air carrier, Canjet, they had some additional officers, CBP officers were assigned to the work with that in terms of the flights. They were brought down from Tampa. Sarasota reimbursed all of the overtime and travel costs for all of the extra officers.
Last year, Sarasota was close to securing an international carrier with a proposed schedule of twice‑a‑week flights. When they discussed this with the Tampa CBP director, they were informed that the general counsel of Washington was interpreting the U.S. law in a different manner than previously, and applying it to a user fee airport. CBP is requiring that user fee airports pay the annual full‑time costs of each officer needed, even if you are only using them once or twice a week, and in this case, it would have been probably for 4 or 5 months a year.
As an example, Sarasota had secured Condor service from Europe twice a week for 7 months, Sarasota would need to pay 12 full‑time officers at an expense of $1.7 million roughly per year, regardless of the fact that Sarasota would only need them 8 hours a week for 7 months. That renders the service unattainable.
I guess my question was to you, as it results to that, Commissioner Aguilar, why has CBP taken such a hard line? Is this standard? It seems to me to be unreasonable. I am concerned about tourism and economic development in terms of our region, and I would say it would be not just applicable to Sarasota but applicable to any airport around the country because we would like to think that one flight could lead to additional flights. We have almost a million people in our economic region there.
Do you have any thoughts on that?
Mr. Aguilar. Congressman, I am unfortunately unfamiliar with the Sarasota situation as you just described it. I know that we talked earlier. I would like to take that for the record and get back to you. I agree with you that we need to revisit if, in fact, the description you just gave, and I will take it for the record and get back to you on it, sir.
Mr. Buchanan. I know that in the 4 or 5 years ago, they did provide service out of Tampa and we paid all of the expenses. So it is something that has been ‑‑ you have had a precedent before where you have done it. But now they have taken a hard line and it is something we have been pushing pretty caressively on it. I say “we,” the authorities at the international airport there. Are there any other suggestions or any other ideas that you would have as it relates to that today?
Mr. Aguilar. Again, I am unfamiliar with just what part of the process we are in.
Mr. Buchanan. Basically it is a low activity airport, and we need part time workers, but again, there would probably be a premium because you have got to move them around or whatever. We are willing to pay everything plus probably a little premium on top. The airport is well‑financed. So it is not a question of picking up the expenses. It is just that they don’t want to have 10 people sitting around for a year where you really don’t need them.
Mr. Aguilar. Exactly. I will review the situation and get back to you with any options that may be available to us.
Mr. Buchanan. I would appreciate that. Mr. Chairman, I yield back.
Chairman Brady. Thank you. Mr. Schock.
Mr. Schock. Thank you, Mr. Chairman. I, too, have a question for Commissioner Aguilar. Thank you for being here. Over the last several months, Customs and Border Protection has taken some positive steps to enhance their supply chain security. The air cargo advance screening program has been successful and is a good model to build on as it continues to expand. You also recently signed an agreement recognizing the U.S. and European Union Custom Security Programs, which is another positive step in securing the supply chain. I want to say that we appreciate your efforts in this area and congratulate you on this recent agreement.
At the same time, it is also important that we find ways to improve the flow of the supply chain in a cost‑effective and efficient manner. One of the ways to do this is to reduce the burden of importing lower‑value shipments into the U.S. If someone ships something into the U.S., the current exemption from entry as you know is $200. However, if an individual comes back from abroad and is bringing back goods into the U.S. with them, there is a personal exemption of $800. The cost to process of these low‑value shipments and the disparity in these two levels of exemptions seem both impractical and also potentially a barrier to growth in jobs that could be created from the importation of low‑value shipments, such as Internet sales of low‑value retail goods.
My question for you is whether or not CBP would be supportive of increasing this de minimis level from the current $200 level to be something more similar to the personal exemption level of $800 or more in order to reduce some of the costly administrative burden of processing those level shipments.
And also in mind of our bipartisan goal here in Congress to increase exports and imports, obviously this is a barrier as it stands. What is your position on that?
Mr. Aguilar. Congressman, I think the question that you asked, the way that I would answer it is in two parts: One is from the operations of the revenue collection; and then the second part, which I think goes more towards my partner, Mr. Skud over here, is revenue generated. So I will take the operations portion of that.
From an operational standpoint, the raising the de minimis
to $1,000 or whatever it would be, does not really impact us operationally. This same amount of work basically will go into collecting either the $200 or the $1000. So from an operational standpoint, it would stay neutral. Now I can say ‑‑
Mr. Schock. Doesn’t it impact more goods?
Mr. Aguilar. Again, I think that is the revenue‑generating portion that ‑‑
Mr. Schock. Revenue aside, if you are affecting all shipments of up to $800, I am sorry. If you are only affecting shipments over 800 as opposed to shipments over $200, revenue aside, you are having to touch and be involved with more shipments or more.
Mr. Aguilar. Yes, sir. And the assessments that we have done, and we have done some of these minimally in the past, in fact, there has been an actual assessment on the $200 up to $1,000, and it has shown that operationally it would have minimal impact.
Mr. Schock. So you need to have the same number of people and the same amount of work?
Mr. Aguilar. Because it is done all virtually and electronically, yes, sir. Now, the one thing I would add, and then if Mr. Scud is interested, I will pass on addressing this also from a revenue‑generating perspective, is one thing we are doing is on the informal entry, is that we are moving forward to moving that up from $2,000 to $2,500, and we are formulating the interim final rule as we speak in order to move that forward, and that will probably be within the next 60 to 90 days, but again, that is only on the informal entry.
Mr. Schock. Let me ask you looking at it from a different perspective. Obviously as the agency from your perspective, it doesn’t reduce your burden, would you admit though that by raising the de minimis level from $200 to $800, you are reducing the burden on constituents, on the business community, on the trading community, if you will?
Mr. Aguilar. I think that is a fair statement, yes.
Mr. Schock. Mr. Skud, do you have a perspective on this you would like to share?
Mr. Skud. Under the current statutory scheme, there is regulatory authority to increase the de minimis amount if we can demonstrate that the savings and processing costs would be ‑‑ would counteract the losses in revenue. And as Commissioner Aguilar pointed out, because the processing would be the same and the processing is largely electronic, and so all of the costs are ‑‑ they are ‑‑ we haven’t seen any evidence of savings there, certainly, if there was a legislative change, that would be, in essence, a tax reduction. Businesses generally look at tax reductions as less of a burden, but the administration hasn’t taken a position on the bill to my knowledge.
Mr. Schock. Okay. My time has expired, but we are working on the legislative fix as well, so thank you.
Chairman Brady. Thank you, Mr. Schock. Mr. Smith.
Mr. Smith. Thank you, Mr. Chairman, thank you to our witnesses as well. Mr. Aguilar, the United States and Canada are each others’ obviously largest export market. Can you tell us what the status is on the U.S.‑Canada Beyond the Border Action Plan unveiled December 7, and is CBP pleased with the progress of the plan to date, and what outstanding recommendations do you see moving toward implementation, and how will they benefit the trade community?
Mr. Aguilar. Beyond the Border Action Plan consists of over, I believe it is 34 or 35 actual items, of which CBP is the lead for all about 16 of them, for obvious reasons. We were basically at the border, and what we are looking to do on Beyond the Border Action Plan is to harmonize policy, harmonize operations, harmonize the consistent way in which we do business. I can report to you that the efforts ongoing between the U.S. and Canada and all of the agencies involved I think is moving forward in a very positive manner.
For those that we are responsible for, of course, there are some that are more challenging than others, especially when it comes to the interagency alignment, if you will, and that is not just from the U.S., it is also from the Canadian side, CBSA is as responsible as we are for the ports of entry.
So that is being worked at the highest levels, actually above CBP and CBSA, to make sure that that alignment happens.
But my report is that we are pleased. I think both Canada and the U.S. are both moving very assertively forward. There are going to be some challenges, which, I believe, my ex‑sheriff up here would appreciate on what we are calling NextGen which is the, literally the patrolling capabilities between the RCMP, ICE, CBP and other agencies jointly. But it is that harmonization, that consistency that dovetailing, that synergy that we are all working towards, and again, my report is, I believe, it has moved forward very positively.
Mr. Smith. Can you touch on some of those items you mentioned by number?
Mr. Aguilar. Well, one of the ones that is probably ‑‑ one of the challenging ones is probably CBSA, operating from Messina, Messina, New York, the port of entry on U.S. land; pre‑clearance; another one is preclearance, working preclearance operations by U.S. officers and Canadian officers on each other’s areas of operations; identifying ports of entry that we may look to either build infrastructure on or build a policy to align on. Some of these ports of entry we might look to reducing, mitigating or even closing some of these in the future. But again, those are the things we are harmonizing our efforts on as never before.
Chairman Brady. Thank you, Mr. Smith. Ms. Jenkins.
Ms. Jenkins. Thank you, Mr. Chairman. Thank you for joining us.
Commissioner Aguilar, could you tell us about Customs’ allocation of import specialists trained in textile and apparel verifications? We have been told that import specialists who have been trained specifically to do textile and apparel clarifications are often assigned to ports that receive very little such trade. I know that Customs does an annual review of import specialists and their locations.
With an increasing need for enforcement and facilitation at high‑volume ports, what are your plans to ensure these ports have adequate staffing, and more importantly, adequate training?
Mr. Aguilar. A couple of things on that question, I think, that is important to mention. One, is that the floors on all trade positions, we have sustained, in fact, as we speak, we are actually above those floors on the trade positions that have been set by Congress. So I want to begin there.
To the question of textile import specialists as to where they are assigned, I don’t have the exact numbers, but I would answer that question with the following: That brings to light the importance of us undertaking the initiatives that we have such as the Centers of Excellence and Expertise, because what that will do, that will give us the capability, again, as I said earlier, either virtually or physically, to service in a specific portion of the industry.
I mentioned earlier that one of the CEEs we are looking to provide is textiles, wearing apparel, and footwear, to where the textile industry would have one centralized location with all of the textile specializing import specialists, all of the national account managers, all the account management, and all of the other disciplines that will be brought to bear in one centralized location to service the textile industry. So that is the vision. That is what we are moving forward on.
Ms. Jenkins. Thank you, Mr. Chairman. I yield back.
Chairman Brady. We are pleased to be joined by Dr. Charles Boustany. Key Member of the Ways and Means Committee but also a leader in trade issues. Dr. Boustany, welcome.
Mr. Boustany. Before I ask questions, I ask unanimous consent to include two letters, one from the Crawfish Processors Alliance, and the other from our Louisiana Agriculture Commissioner to be made part of the record as well as testimony from one of our colleagues in Congress from our Louisiana delegation, Mr. Richmond.
Chairman Brady. Right. Without objection.
[The letters follow: The Honorable Charles Boustany Letter 1, The Honorable Charles Boustany Letter 2]
Mr. Boustany. Thank you, Mr. Chairman.
I think we all agree that evasion of our trade remedy laws is a serious problem, and additional authorities, perhaps legislation, is going to be needed to provide more tools. I am very sympathetic to the complaint raised by some American companies that CBP, in effect, becomes a black box after receiving allegations of evasion and provides little or no feedback on the adequacy of the allegation, what steps are being taken by CBP or another agency as a result of the allegation, or even the ultimate outcome of any of the actions.
On the other hand, I have to say I am very concerned about imposing artificial deadlines on investigating invasion because some of these cases are more complex and just simply arbitrarily placing a deadline would be problematic.
So I would like to understand how can CBP and ICE work better with the private sector on evasion without undermining its ability to investigate or otherwise address evasion. If you could all answer that for me, I would appreciate it.
Mr. Kibble. Congressman, one of the joint ventures that we have at the Intellectual Property Rights Center, one of the things we do is in the outreach and training section. We have very robust engagement with the industry, and we do communicate whether we, for example, are opening a criminal investigation, and perhaps, what location that may be at. Now, obviously, as the investigation continues that we are limited in terms of the types of things we can share in a criminal context.
But we are committed ‑‑ we put together, in particularly, talking about to seafood industry, for example, we have really enhanced our engagement with the seafood industry in particular, as well as others, to learn from the industry, to inform our operations, but also, again, to share what is appropriate to share in terms of the status investigations so that it is not a black hole. There is not another lack of information.
Mr. Boustany. What happens when an E‑allegation is filed? Can you walk us through some of the steps?
Mr. Aguilar. On the E‑allegation specific. We, CBP, will take the initial efforts to start identifying that which has been reported. We work hand‑in‑hand with the Department of Commerce which, as you know, Congressman, will actually take on the investigative portion of that. Now, that is where I think some of the concerns start to make into play. The antidumping, countervailing duty system that we have in place right now is very challenging and it is very complex. It is not any one agency that can service the interested parties on the outside. We, too, are very appreciative of the frustrations that exist out there.
Mr. Boustany. Is there a better way to set up an interagency process or point of contact?
Mr. Aguilar. I think the points of contact, and again, this is my take on it, the points of contact are there. E‑allegation, the countervailing case development, moving it forward, but it is just a complexity of the system that we have in place and procedurally what we have to go to and what we are constrained by once an investigation begins. There is only so much that can be shared with the public.
Unfortunately, our system right now that we have in place sometimes that takes up to 2 and 3 years before a final decision is made. As you know, Congressman, at that point then when we, the CBP, are given the go‑ahead to start collection proceedings, some of these companies have either gone out of business, have changed names or are unaccessible to us in other parts of the world.
So it is a very difficult, very challenging, very complex system that we have in place, but the one thing I can tell you with our partners in ICE and commerce, everybody is very focused on moving within the constraints that we have as aggressively as we can on the cases that we do have.
Mr. Kibble. Sir, if I could add one thing. These investigations are so complex, and there are certain challenges we face in terms of prosecution. But I will tell you the antidumping countervailing duty investigations have been a principal focus of the commercial problem working group, and one of the things that I think will be helpful in terms of expediting the resolution of these investigations and getting more of them prosecuted is training.
Because we have a number ‑‑ and this includes, by the way, training for prosecutors, that perhaps also recognizes the sensitivities in terms of the delays that these investigations can take. But as the Commissioner indicated, there are hurdles to overcome in terms of when these cases go a certain track.
Mr. Boustany. We will work with you to hopefully get the system even better.
One of the last issues, if, Mr. Chairman, if I might just ask one quick follow‑up question.
Boots on the ground. Your ability to get boots on the ground to investigate a lot of these cases, that has been an issue as well, and particularly foreign jurisdictions. Could you address, briefly address that.
Mr. Kibble. There have definitely been challenges in terms of, in some cases, travel advisory ‑‑ and here I am talking about commercial fraud in general, not just, or perhaps forced child labor investigations and other types of disciplines. There can be difficulties. I mean, in some cases there may be unwillingness on the parts of the government to assist us in furthering the investigations. Some of the inspections that ‑‑ the verifications that we seek to do. There are some challenges there.
I would say that we have expanded our global presence, within ICE anyway. We have about 71 foreign offices around the world ‑‑ we have been going through a footprint analysis to make sure that it doesn’t reflect this historic Cold War footprint and looks at the challenges of the future and where the cases are. And part of that, though, is there is one thing about getting boots on the ground, but there is the willingness of the government to work with us, so that is the significant issue as well in terms of where we choose to invest the scarce resources we have.
Mr. Boustany. Thank you, gentlemen. Look forward to working with what we have.
Chairman Brady. Thank you, Doctor. I want to thank all of the witnesses. Reminders, Commissioner Aguilar, you were going to present, send us a list of the functionality for ACE for this year and a list of the CEE topics subjects are going to be, and I think all three of you have agreed to send us your measurements, both what you are looking at today and what you are thinking about looking at again. We are all in our jobs to make improvements and progress, and if we know what you are looking at, we can also obviously add our thoughts to that as well. I want to thank you all for being here today.
Our second panel of witnesses is from the private sector. First as he makes his way up here, a special welcome home to a former Ways and Means staffer, George Weise, who will give us his perspective both as a former Customs Commissioner and now as an Adviser in Trade.
Mr. Sekin and Mr. Mullen will testify on how related services add value to our supply chain.
Mr. Williams and Mr. Glassman will testify about the importance properly assessing and collecting the anti‑dumping duties and the impact these duties have on their products and ability to provide jobs.
And as we get settled in, I would like to pass Dr. Boustany to personally introduce Mr. Williams.
Doctor?
Mr. Boustany. Thank you, Mr. Chairman. Thank you again for letting me participate in this hearing.
It is my pleasure to introduce John Williams with over 40 years of experience in every aspect of the shrimp industry, John now serves as the executive director of the Southern Shrimp Alliance.
In addition to his leadership role with the alliance, John serves on numerous advisory panels, supporting the shrimp industry on a wide range of issues. And it should not be a surprise to anyone in this room that our Gulf shrimpers and other aquaculture industries are facing serious challenges from the invasion of anti‑dumping and countervailing duty orders.
Given the hurdles our domestic industries face, and John’s firsthand knowledge, I look forward to hearing his expert testimony today, and John, I just want to thank you for joining us for sharing your insights on the problems and possible solutions.
Again, Mr. Chairman, thank you for allowing me to participate and I yield back.
Chairman Brady. Thank you all for coming here today. We will submit your written statements for the record, and I ask you to limit your statements to no more than 5 minutes. Mr. Weise, thank you for joining us.
STATEMENT OF HON. GEORGE WEISE, EXECUTIVE VICE PRESIDENT, SANDLER & TRAVIS TRADE ADVISORY SERVICES, (FORMER COMMISSIONER OF CUSTOMS)
Mr. Weise. Thank you so much for your kind introduction. It is a pleasure to be back in this room where I spent 9 very, very interesting positive constructive years. It is a homecoming for me, and it is great to be here to talk about an agency that has meant so much to me for so many years.
I am appearing today in a personal capacity, and not on behalf of any organizations to which I am affiliated. In the interest of time this morning, I will focus my oral comments on the critical need to see ACE and ITDS fully implemented as soon as possible, and I thank you for submitting my entire statement for the record.
My hope in appearing before you today is to provide some historical perspective on this important issue. My views have been shaped from 40 years of experience in the Customs and trade field, from my early days working as a GS‑5 import specialist for U.S. Customs in the Port of Baltimore, my Customs oversight worked while serving this committee, including the development and enactment of the Customs Modernization Act of 1993, and my tenure as Commissioner of The U.S. Customs Service from 1993 until 1997.
Since leaving government service in 1993, since then ’93, I have spent 15 years working in the private sector trying to help commercial companies cope with government regulations and get goods moved as quickly as possible.
Much has changed since I left office as Commissioner in 1997. The old Customs service in the Treasury Department Has become U.S. Customs and Border Protections. CBP is more than triple the size of the former Custom service, with a much broader mission and a focus on border security as a critical component of the Department of Homeland Security in the aftermath of 9/11.
Congressional oversight of the agency has also become more complex. In the good old days, when the Committee on Ways and Means and the Senate Finance Committee had exclusive jurisdiction over the former U.S. Customs Service, numerous committees and subcommittees now share oversight responsibility for CBP.
Today, CBP is responsible for a myriad of challenging and complex missions to safeguard our Nation and, for the most part, is doing an outstanding job. Although it is understandable that CBP has placed the highest priority on security and anti‑terrorism, it is also clear that CBP needs to play a critical role in our national economic security by effectively executing its trade enforcement and facilitation missions.
As much as things have changed since my days as Commissioner, I am also struck and distressed by how much they remain the same in implementing the tools necessary to effectively address CBP’s national economic security mission.
With the leadership of this committee, the Congress enacted the Customs Modernization Act in the fall of 1993, soon after I became Commissioner. This legislation significantly changed our Customs laws to enable modern techniques and procedures to be applied to the importing process. Charged with implementing that important legislation, it immediately became clear to me that a new automation system was critical to achieve the modernization objectives of the MOD Act, since the decades‑old automated commercial system which was in place at that time was not capable of handling many of the new streamlined procedures of the MOD Act. Also I was told that it was crumbling because of overuse and lack of capabilities.
It was also clear that we had to find a way to consolidate the data requirements placed on importers by the numerous government agencies involved in regulating imports. To address both issues, we began, at that time, back in 1994, working with Congress to seek funding for ACE and ITDS. Needless to say, it is extremely disappointing that nearly 20 years later, after the expenditure of many millions of dollars, we are still far from completion of ACE or ITDS.
I commend former Commissioner Bersin and Commissioner Aguilar for their leadership in recent years. They have recognized the importance of CBP’s economic security mission and made significant strides to address these shortcomings. Notwithstanding these positive efforts, however, we are nowhere near where we need to be.
In my judgment, the commercial operations of CBP are lagging vis‑à‑vis the security mission of CBP. Despite significant efforts and millions of invested dollars, we are a long way from bringing ACE and ITDS to successful conclusion.
It is clear to me that the top priority to address these issues is to find a way to bring ACE and ITDS to a successful conclusion, and with that, retiring the ACS system as soon as possible.
I understand that the current budget appropriation for CBP only provides funds for operation and maintenance of the ACS system and nothing for the development of ACE. This, in my judgment, is a shortsighted approach that will not only foster the continuation of costly and burdensome systems, but will further delay the goal of creating a single modern system to facilitate trade and enhance CBP’s enforcement mission. It is understandable why additional funding for ACE development was not appropriated in light of the many millions of dollars already expended over this program over the many years and so little tangible to show for it. But again, I think an historical perspective might help here.
During my term as Commissioner, I worked very hard but unsuccessfully over my entire 4 years to convince the Congress to fund ACE development. At that time, we were convinced having built ACS the predecessor system, on our own, that we were capable of building the next generation of automation as well.
The clear message I received, however, was the only way Congress would ultimately approve ACE funding would be if Customs brought in outside experts to do the job. Several years after my departure, that is exactly what happened and the IBM team was awarded the contract to build ACE.
Unfortunately, the program was then viewed as a contracted IT effort rather than a CBP initiative, and the result of that was CBP’s key operational leaders were not engaged to the extent that they should have been. Consequently, operational requirements were not well defined, and the process bogged down with a lot of wasted effort and well‑deserved criticism from many sources.
Another factor leading to the scheduling delays and higher costs for the program was in the aftermath of 9/11, CBP completely redirected much of its programming efforts and understandably ,so from facilitation to border security, changing the game sort of midstream. The problem has now been addressed by CBP in my judgment, and I think this committee has appropriately commended Commissioner Aguilar for the efforts that had been taking place. They have now created the ACE business office, which actively and effectively involves key stakeholders at every level.
Chairman Brady. Commissioner, if I may, because we have exceeded the time limit, perhaps we can ask you some questions on the follow‑up with your permission. Thank you again for being here today. Welcome back.
[The statement of Mr. Weise follows:]
Chairman Brady. Mr. Sekin.
STATEMENT OF DARRELL SEKIN, JR., PRESIDENT AND CEO, DJS INTERNATIONAL SERVICES, AND PRESIDENT, NATIONAL CUSTOMS BROKERS AND FORWARDERS ASSOCIATION OF AMERICA, INC.
Mr. Sekin. Good morning, Chairman Brady and Ranking Member McDermott. I am Darrell Sekin, Jr., President of the National Customs Brokers and Forwarders Association of America and also the President of DJS International Services, a small family‑owned customs brokerage and freight forwarding firm located in Colleyville, Texas.
Since my start as a Customs broker in 1975, the industry has undergone an enormous change, particularly in the area of automation. Customs automation is a powerful tool facilitating smooth trade flows and sharpening enforcement of trade laws.
Customs automation is the communications channel between the importers and CBP. Customs brokers are instrumental to this process: information, data and transmitting the information necessary for the agency to function. That is why my first point to the committee needs to be about the importance of ACE and to underscore the comments of Mr. Weise.
The funding requests from the administration is inadequate, and the pending House Appropriation Bill guarantees nothing for ACE development. Currently ACE functionality is the bridge that only goes halfway over the river, practically speaking, it cannot process entries, its core responsibility until release is finished. Release is in the on‑deck circle, and without funding for it, the system promises little incentive for Customs brokers who file 97 percent of the entries to participate.
My second point addresses the role of the broker. At one point during my career, Customs regulated each and every aspect of a Customs broker’s business. In the mid 1980s, Customs agreed to separate the commercial and proprietary aspects of Customs brokerage from what has come to be known as Customs business. The latter signified recognition that we are an extension of Customs and that there must be intensive oversight and supervision of Customs‑related activities.
We are therefore licensed by Customs and subject to costly penalties for errors and omissions in conducting Customs’ business. In short, the exchange for the privilege of engaging in Customs brokerage and to ensure the integrity of the entry process, we are committed to meeting Customs’ exacting standards and rigorous regulation. This is Customs and the Customs’ brokers grand bargain.
Customs is now seeking to expand the role of the broker. A customs broker is viewed as a force multiplier because one customs broker reaches, educates, and acts for a multitude of importers, whether they be small, medium, or large‑sized businesses. There are many ways that customs brokers can collaborate with Customs, such as education and certification. To enhance the professionalism of the customs broker, our national association developed a broker certification program that requires a rigorous course of study and examination, and also includes a continuing education requirement.
We have begun in partnership with Customs a series of educational seminars for Customs officials.
NCBFAA is presently engaging with Customs in an effort to update the Customs regulations that apply to customs brokers.
We must also generate support for new Customs programs and we are working closely with Customs on ACE and on the air cargo advanced screening pilot. We have also agreed to assist with incorporating customs brokers into the development of the New Centers of Excellence and Expertise. And finally, we must advocate for a series of high‑priority Customs issues.
NCBFAA recognizes that there are many challenges for Customs to accomplish its missions. We support a number of steps that will improve the commercial operations performance of the agency such as drawback modernization and simplification and a prospective system for anti‑dumping and countervailing duties. We must encourage efforts to expedite and facilitate the trade function of other Federal regulatory agencies. One such means to that end is the International Trade Data System, a component of ACE that provides each participating agency a window on the importation process. We support the committee’s efforts to gain continued adequate funding for ITDS.
Mr. Chairman, NCBFAA greatly appreciates the opportunity to outline our views on Customs oversight and new policy development. We stand willing to support the committee and all of its work to accomplish these objectives.
Chairman Brady. Thank you very much, Mr. Sekin.
[The statement of Mr. Sekin follows:]
Chairman Brady. Mr. Mullen.
STATEMENT OF MICHAEL MULLEN, EXECUTIVE DIRECTOR, EXPRESS ASSOCIATION OF AMERICA
Mr. Mullen. Mr. Chairman, Mr. Ranking Member, I very much appreciate the opportunity to testify today at the hearing and applaud the committee for taking the time to examine the critical issues around streamlining and modernizing the shipment clearance process at our Nation’s entry ports.
I am the head of a trade association that represents the major express package companies: DHL, FedEx, TNT and UPS. Since the trade committee last held a hearing on these issues 2 years ago, I think it is fair to say that considerable progress has been made. CBP has adopted an approach known as Co‑Creation, which Commissioner Aguilar described, where the private sector is engaged from the outset in the development of new security and border clearance programs. Co‑Creation was used successfully to develop the air cargo advanced screening and the simplified entry pilot projects, which are described in detail in my written testimony.
The Centers of Excellence and Expertise have implemented the concept of account management for two industries, and CBP is planning to expand this approach to additional sectors. “The Border Agency Executive Council” was created to reinvigorate the commitment of government agencies with border authorities to the international trade data system. And the European Union has become the sixth partner to sign a trusted partner mutual recognition agreement with the United States.
Former CBP Commissioner Alan Bersin should be given credit for much of this progress, and current Commissioner David Aguilar is carrying forward these efforts with strong dedication.
But despite these positive developments, a great deal remains to be done. A disappointing lack of progress can be seen in the following areas: ACE funding has been seriously reduced and is now only sufficient to maintain the current operational status. Critically needed new capabilities are not being developed.
The ITDS goal of a single transmission of information from the trade and a single government release remains an unfulfilled vision. As the agencies continue to deploy standalone IT systems to meet their unique requirements, the progress toward the ITDS goals is actually receding. Despite strong appeals from the trade, the de minimis level for rapid clearance for low‑value shipments has not been raised above $200 where it has remained for nearly 20 years. The Peterson Institute of International Economics has done a study that has shown significant savings to the private sector approaching $100 million a year, and some savings also to the public sector would result from raising this level.
C‑TPAT benefits have not been expanded, and tier 3 status continues to be limited to importers only, denying several highly‑qualified members in the carrier and other trade communities the opportunity to hold this status. We are not seeing progress toward a unified trusted partnership program in the United States, and the trade community continues to be plagued by the need to comply with unique programs for different agencies. As the number of such programs is increasing, we are actually going backwards in this area also.
In the best of all possible worlds, what should the border clearance process look like by the end of this decade? The government should look at the border as a business entity that needs to be managed and develop all of the capabilities needed to do so. With sufficient political will, I believe it is possible to create a border 20/20 environment over the next 8 years with the following capabilities: Government information requirements will be met by a single transmission of the minimum data elements necessary, submitted as early as possible in the supply chain; no paper documents will be required as part of the clearance process; all government agencies will coordinate to issue a single release prior to the goods arriving at the port of entry; ACE will be fully operational and will be the only U.S. trade clearance system; Centers of Excellence and Expertise will exist for all major import categories; the government will have a single trusted trader program in which all agencies with border authorities participate with a single application and validation process; the U.S. de minimis level will be at least a thousand dollars and will be automatically adjusted for inflation without the need for additional regulatory or legislative action.
To sum up, this concept of the 2020 border represents an ambitious proposal. The building blocks to create each of these capabilities are in place today, but realizing this vision requires a congressional oversight management process that transcends narrow jurisdictional concerns and treats the effort as a single project. Nothing less than the international competitiveness of U.S. industry and ultimately U.S. jobs are at stake.
Thanks very much again, and I look forward to discussing these issues with you.
Chairman Brady. Thank you, Mr. Mullen.
[The statement of Mr. Mullen follows:]
Chairman Brady. Mr. Williams.
STATEMENT OF JOHN WILLIAMS, EXECUTIVE DIRECTOR, SOUTHERN SHRIMP ALLIANCE
Mr. Williams. Mr. Chairman, members of the subcommittee, thank you for inviting me to this hearing. I am John Williams, the executive director of the Southern Shrimp Alliance, and a shrimper with over 40 years in the industry.
I am here to talk about Customs enforcement, something that is not a typical area of the expertise for a shrimper but it has become a central part of my duties.
Customs enforcement should not be the responsibility of a fisherman. There should not be blatant circumvention schemes where millions of pounds of shrimp pour into our market from a country that has no ability to produce that product. There should not be businesses publicly advertising their expertise at evading anti‑dumping duties. Since 2005, the Southern Shrimp Alliance has identified a wide variety of schemes designed to evade anti‑dumping duties. In that time, I have learned that our industry’s experience is not unique. Nearly every trade remedy imposed has been undermined. Circumvention affects all of us.
On shrimp imports alone, circumvention has resulted in hundreds of millions of dollars in uncollected duties. This means that dumped shrimp continues to be sold in our market at prices that limit what shrimpers receive for their catch.
My experience working with Customs has been positive. One operation closed down dusted shrimp circumvention. Customs worked to establish that Cambodia, Indonesia, and Malaysia were transshipment points to evade both duties and the import alerts issued by the FDA. Customs has also closed fly‑by‑night shrimp importers simply by opening investigations into their activities.
As much as the shrimp industry has benefited from these activities, there is also frustration. I am often frustrated with the glacial place of progress on addressing certain schemes that seem to be open and obvious. Customs officials, in turn, express frustration on the limits of their abilities to address circumvention. Our experience has convinced me that Customs needs assistance in improving its enforcement of trade remedies. I believe that given the right tools, Customs will do the job. For this reason, the Southern Shrimp Alliance enthusiastically supports H.R. 5078, the Preventing Recurring Trade Evasion and Circumvention Act, introduced by Congressman Boustany and Richmond last week.
The PROTECT Act makes circumvention a priority trade issue that Customs must address. The toughest part of our early interactions with Customs was the lack of continuity with those officials responsible for enforcement. Reorganization agency just made it worse.
The PROTECT Act simplifies this. If enacted, Customs would have a trade remedy law enforcement division with a director that reports to an assistant commissioner. Because high‑level enforcement positions have sat vacant with Customs, some have questioned whether the agency considered the enforcement of trade remedies to be a priority.
I know from my own experience that Customs takes enforcement seriously, but there is little public record to support that. Under current law, Customs provides very little accounting of these activities. Under the PROTECT Act, Customs is obligated to give a detailed accounting of its enforcement efforts in an annual report to Congress.
The PROTECT Act also makes addressing circumvention a principal negotiating objective of the United States in trade agreement negotiations.
Malaysia has become an obvious transshipment point for all kinds of products evading anti‑dumping duties. From our work with Customs, I understand that the Malaysian government has refused to cooperate with investigations. At the same time, we are negotiating with Malaysia to join the transpacific partnership. Circumvention must be addressed in these negotiations.
The PROTECT Act also instructs Customs to seek to negotiate and enter into bilateral agreements to circumvention. Like with trade remedy enforcement, if Customs declines to use this authority, the agency must explain inaction to Congress on an annual basis. The PROTECT Act substantially increases Customs capacity to address circumvention by removing restrictions on the information available for use in commercial targeting. The Act also encourages enforcement by authorizing the sharing of confidential information between various Federal agencies. The PROTECT Act also improves Customs’ capabilities by enhancing its ability to collect information and authorizing Customs to make adverse inferences against noncooperating parties. This bill also prevents the abuse of the new shipper review process and promotes better application of single entry and continuous bonds to ensure duty collection.
In closing, I believe that these are vital steps forward, and I am deeply appreciative of the fact that Congress has taken these problems seriously as evidenced by this hearing today and Legislative proposal the PROTECT Act. By introducing the PROTECT Act, Congressman Boustany and Richmond have given me some hope that in the future, Customs enforcement may not be a part apart of my job.
Thank you, and I look forward to any questions you have.
Mr. Brady. Thank you, Mr. Williams.
[The statement of Mr. Williams follows:]
Chairman Brady. Mr. Glassman.
STATEMENT OF KARL GLASSMAN, CHIEF OPERATING OFFICER, LEGGETT & PLATT, INCORPORATED.
Mr. Glassman. Good morning, Chairman Brady, Ranking Member McDermott, and members of this committee. Thank you for holding this hearing on topics that are critical to our business, employees, economy, and trade laws. I am the Chief Operating Officer of Leggett & Platt, a global manufacturer based in Missouri. We have 18,000 employees in 18 countries and 28 States and make a wide variety of products.
For the last 3 years, we, along with many of you, have been focused on duty evasion. Clearly, there is work to be done to create an effective enforcement program that ensures aggressive and timely action.
Duty evasion has directly affected my company. Since 1883, we have manufactured mattress innersprings. While we now make many products, we are the world’s largest innerspring producer, and they are the heart of our business.
Chinese innersprings first entered the U.S. in the early 2000s, at prices lower than our cost of production. We manufacture innersprings in China for the Asian market and know it is not cost effective to produce and ship innersprings from there to here. Still increasing volumes of Chinese innersprings continued to be imported at very low prices.
In late 2007, after significant injury to our U.S. operations from the low‑priced springs, we filed successful trade cases against China, South Africa, and Vietnam. Since February of 2009, Chinese innersprings have been subject to anti‑dumping duties from 164 to 234 percent. Even before the final anti‑dumping order was issued, Chinese innersprings began being transshipped to evade duties. Prior to July 2008, there were no innersprings shipped from Hong Kong, yet by September of that year, over 35 containers per month, worth $1.5 million in sales and more in duties, were being shipped here at the same dumped Chinese prices. This made no sense to us so we hired a private investigator who found no evidence of legitimate production in Hong Kong.
We traced 13 shipments of innersprings from China to Hong Kong and then from Hong Kong to the U.S. in just 2 months. We estimate 1 million innersprings illegally evade the anti‑dumping order each year. This represents over $50 million in uncollected duties. If those innersprings were produced in the U.S., it would account for over 58 full‑time jobs earning more than $2.4 million in wages and benefits per year.
We regularly provide Customs with specific evidence of evasion. Since October of 2008, we have met with or sent information to Customs on 30 occasions. Despite these regular communications, including with the RED team, we have no indication of any enforcement activity in our industry. This is a systemic problem. We and 13 other affected industries, collectively employing tens of thousands of American workers formed the Coalition to Enforce Anti‑Dumping and Countervailing Duty Orders. Our stories are strikingly similar: the same invasion schemes, lack of meaningful enforcement, and an ongoing commitment of company resources to attempt to enforce our own orders.
The consequences of duty evasion are significant. We estimate that Treasury loses over a billion dollars in unpaid duties each year with $400 million just from the seven of the Coalition’s industries.
The ripple effects of duty evasion up and down supply chains, on our workers’ salaries, and on our Communities cannot be ignored. Coalition members have met with Customs, ICE, Commerce, USTR, Treasury, this committee’s staff, Senate Finance staff, and several Members of Congress and their staff concerning these issues. We are encouraged by the efforts of many members to help find a solution.
Any legislation or policy changes must include meaningful provisions capturing three core themes: First, prompt action. Evasion must be addressed quickly. These are industries and employees that our government has said are injured and who need and deserve the benefit of their anti‑dumping order.
Second, full use of existing tools. Our agencies should use all available tools and authority, including requests for information, audits, civil penalty proceedings and expertise of affected industries.
Third, publicized results. Publishing regular decisions and reports with meaningful details, and informing the industries reporting evasion, would provide an immediate deterrent to cheaters, increase transparency and accountability and demonstrate the agency’s will and capabilities to combat evasion.
Codifying practices that are less than fully effective is not enough. Our enforcement agencies need structured programs with appropriate levels of responsiveness, transparency, and accountability. We must find a solution. The alternative is unacceptable. We are committed to helping come up with solutions that go beyond business as usual and deliver an effective enforcement program.
Mr. Chairman, members of this subcommittee, thank you for the opportunity to address you today. I look forward to your questions.
Chairman Brady. Mr. Glassman, thank you for bringing forward the issue of trade fraud. It has been prevalent for some time, getting more complex. It is a major challenge for us moving forward so thank you for focusing on that.
[The statement of Mr. Glassman follows:]
Chairman Brady. Mr. Williams, my congressional district abuts Dr. Boustany. We have got a few shrimpers around Texas as well. Very interested in your testimony.
I want to welcome Mr. Weise back to the committee and thank you for your expertise. You heard me perhaps in the first panel talk about the need for measurements. In fact, United States is ranked ninth in efficiency by one measurement, lower than that, Customs’ efficiency 13th in the world, international shipments, 17th. Whether that comparison’s accurate or not, the point is that we have become much more efficient, and to do that you have to measure the efficiency and the accuracy and the enforcement.
So I wanted ask Mr. Sekin and Mr. Mullen and to ask any of you to chime in if you wish, how are your customers measuring efficiency of shipping, Mr. Sekin, and how are your members, Mr. Mullen, doing the same? What do you use to measure efficiency, time, cost, for both imports and exports?
Mr. Sekin. I think one of the ways that our client’s measure efficiency is how quickly their shipments are processed, how many examinations they get and when, shipments are detained for examination, how long does that detention last? There is a great deal of expense when a shipment is detained for examination at the seaport, such as demurrage charges or per diem charges on the container. It can be very expensive. So a customer would measure how quickly they get their product and can get it into the marketplace.
Chairman Brady. Would you be willing to survey your members to ask what some of those indicators might be with the broad range of them that might be that they would feel comfortable sharing with us as we go forward?
Mr. Sekin. We would. We will get back to you with that.
Chairman Brady. Thank you very much. Mr. Mullen?
Mr. Mullen. Mr. Chairman, this is a very important subject, and I would share what my colleague said about the importance of time for release, the time from when the product actually arrives at the port of entry to when it is ultimately released. If there is a hold imposed, what the time is required to resolve the hold, and I think a particularly meaningful measurement that could be developed is that several government agencies, it is hard to know exactly, but one number we use is that nine government agencies have border control authority, so in other words, have the authority to stop a product at the border for one reason or another. Most of those choose to discharge those responsibilities through CBP, but some do not. But for each one of those agencies, a statistic should be developed of all the products that are coming in that are under the regulatory control of that agency, let’s choose FDA as an example.
Of all the products FDA regulates, what percentage are stopped for some reason, an inspection or some other reason, are put on hold? And of that percentage that are put on hold, what percentage do they actually find that there is a violative product, a noncompliant product? So to improve trade efficiency, what you would want is that the number of overall products that are being held, that percentage keeps going down, and the number of violative products they find keeps going up. That would be a very good measurement.
Chairman Brady. I appreciate that. On the time for release, what is the trend? Is it getting shorter? Is it getting longer? Does it vary?
Mr. Mullen. I think overall it has gotten better for some agencies, but for some agencies it has gotten worse.
Chairman Brady. Can you survey your members as far as indicators they think would be meaningful as we move forward as well as to the comfort level they have in sharing with us?
Mr. Mullen. I certainly can.
Chairman Brady. Any other witnesses want to weigh in?
Mr. Weise. Just briefly, and I think you raised this with Commissioner Aguilar. I think Customs has come a long way in trying to measure the right things. I mean, back in my day, we used to try to measure the instances of noncompliance as opposed to measuring what total compliance should be. Once we got to that point and we were able to demonstrate that we could show marked improvement to get the compliance levels up to was roughly 90 percent and the duty gap was only 1 percent. So we were collecting 99 percent of what we should be collecting in reviews, and we had 90 percent compliance level on most of our many importers. But it is important to have those measurements and metrics on both sides, both from an efficiency standpoint as well as an enforcement standpoint.
Chairman Brady. And our challenge, too, on enforcement is that we often measure progress by bulks, by volume versus what percentage you are actually stopping, you know, at the border accurately, and it is hard to be noble about what that bulk of fraudulent shipments is, so that presents a particular challenge. Yes, sir, Mr. Williams?
Mr. Williams. Yes, I think if we are going to measure, have any kind of measurement in our industry, you know, we are quite a bit different from other folks here, I think it would be our price. You know, that would determine, help determine the amount of circumvention that is going on in our industry, and that would be certainly a measurement by our price how much it goes up and down.
Chairman Brady. Good point. Thank you, sir. I will turn the questioning over to Mr. McDermott.
Mr. McDermott. Thank you, Mr. Chairman. As I listen to Mr. Williams and Mr. Glassman, I try to figure out in my mind what can we up here do to make it better? I mean, what kind of rules and regulations should we write for Customs or is it a lack of personnel? And I get a different view from Mr. Glassman and Mr. Williams about how effective the agency is. Can you tell ‑‑ I mean, one is dealing with fish and another is dealing with high tech stuff and whatever. Is it the sector you are into that Customs is better at than they are in another sector? Or is it the region you come from? Or is it something else? Why do I get these different views from the two of you?
Mr. Glassman. Mr. Congressman, I would speculate that the fact that the FDA is involved in the food aspect of Mr. Williams’ product may be one of the points of difference. I can only benchmark ourselves against the 13 other industries in our coalition, and they have twin experiences to ours, constantly giving CBP information and it going into that proverbial black hole and no follow‑up. I don’t think that there is any need for additional tools. We don’t think that there is need for additional expenditure on resources. What we are asking for is to use the tools that are available to the agency today to enforce timelines so there is accountability.
I certainly subscribe to Chairman Brady’s position on measurement. The very basic theory of continuous improvement is to effect development or improvement, you have to have a measurement system. Timelines are a measurement system. So we need to invoke that into the process.
Mr. McDermott. If I understand you, then, what you are saying is we don’t need more people, we don’t need more money. What we need is enforcement of what is going on by using some kind of timeline that it has to be done within 2 weeks or 3 weeks or whatever it is.
Mr. Glassman. And they also, sir, can leverage the information that is given to them. I will give you a specific example. In a meeting with CBP staff a year or so ago, they said do us a favor and present to us a list of the top 10 importers of record, and then correlate that very tightly with the recipients of those goods that you believe are, in fact, circumventing. We did that very thing. Two weeks ago we were asked for that same information. That is information that is available to CBP and isn’t utilized. We have full‑time employees purveying databases to try to get information that goes into that black hole. Really what we are asking for is time and attention and enforcement of our trade laws.
Mr. McDermott. So explain to me, then, what you think is not going on. I mean, they have the data, you presented it to them, but nothing happened. Is that just sloth or is that they are overworked or it is not complete data or they don’t know, or is there some other reason why it doesn’t get dealt with? Because it seems like it is all there on the table for anybody who would look. Then the next thing is why didn’t they take the action? How do you explain it to yourself?
Mr. Glassman. I admit it is frustrating. I believe it is a lack of focus and accountability. One of the real benefits of the PROTECT Act, as Mr. Williams delineated, is there is an expectation of accountability and focus on circumvention. The fact that circumvention isn’t something in enforcement, isn’t something that gets a lot of visibility is a question to us. We are as baffled as you are, sir.
Mr. McDermott. Is it that there are better teeth in the PROTECT Act or more teeth or ‑‑
Mr. Glassman. The fact that there is a systematic approach, the fact that we are using the 10 plus 2 information for commercial uses is a benefit. The weakness that we believe in the particular proposed Act, though, is the accountability or the tools of measurement, the timelines, the transparency. Those are the things that we think can help augment the PROTECT Act to end up with a better end product.
Mr. McDermott. So you are talking about additions to Mr. Boustany’s proposal in terms of tightening of the teeth?
Mr. Glassman. It would potentially be a merging of the PROTECT Act and the ENFORCE Act that Congressman Neal made reference to earlier today.
Mr. McDermott. So a marrying of the two?
Mr. Glassman. That is correct, sir.
Mr. McDermott. Okay. Thank you very much. Thank you, Mr. Chairman.
Chairman Brady. No, thank you, Mr. McDermott. Mr. Davis.
Mr. Davis. Thank you, Mr. Chairman.
Mr. Mullen, I have heard from some in the trade community that agency holds from agencies such as FDA, USDA, and DEA can delay shipments several days longer than the CBP holds. To your knowledge, have members of your association experienced difficulties with paperwork requirements or any other requirements from agencies other than the Customs and Border Patrol, and in your view, what can be done to improve the multi‑agency processes and how can Congress streamline legitimate trade processing?
Mr. Mullen. Well, thank you, Mr. Davis. It is a serious problem, and I think the comment was made during the first panel that on a percentage basis more holds come from other agencies now than those that are imposed by CBP for security problems. And I think several things actually could be done to help alleviate this problem. The first thing is that a number of other agencies of the Federal Government don’t see trade facilitation as being part of their mission, and they are enforcing a regulatory process that is based on a desire to identify product safety and other problems that is critically important, and that part of their mission is critical to the health and safety of the American people, but they need to understand that they have become partners in a supply chain at this point, and they need to look at what they can do to provide more trade facilitation for legitimate shippers.
So there are a couple of efforts underway right now to really expand the basic C‑TPAT model and create trusted trader programs that would incorporate other agencies, and the Certified Importer Project is the most important, I would say, of those efforts right now, where if a company can validate its supply chain from one end to the other, it shows that it has good manufacturing processes, a secure supply chain, those products should receive expedited treatment when they arrive at our border.
A second thing that could be done is many of the holds that other agencies put on products are because of document requirements or for some small inaccuracy in the information that was submitted electronically. Those kinds of problems, where it is a highly ‑‑ otherwise a highly compliant importer shouldn’t hold up the release of the product. Let the product go, and the document can be provided or that little inaccuracy in the submission of the information can be corrected after the product has already been released. There are all kinds of ways to audit this process to make sure that what the government requires is actually provided.
And then the third thing I would say is some of these other agencies could do a better job if they centralized some of their resources. If it is just a question of examining documents, which often are available electronically, if trying to do that ‑‑ instead of trying to do that at every port of entry where their products are coming in, it is a virtual process, centralize those resources in a place where the right expertise would be available, and it might be available for a longer period than 8 hours a day.
Mr. Davis. Do you think it would be more effective to have a common data warehouse that all the agencies could draw from? A shipper, in effect, signs on to what would be the equivalent what we call in the private sector is part of a customer master and then the different agencies can flag the information that is relevant to them, but it is all transparent to speed, to expedite the process through. In fact, not unlike making a credit card transaction. If there is something that comes up, it flags automatically by whatever network is observing that and then action can be taken appropriately. Would that fit the model that you are talking about?
Mr. Mullen. Something like that would, I think, be excellent if you are talking about consolidating the information.
Mr. Davis. I think if you just have to fill out a form one time ‑‑ I mean, we see it in the entitlement programs all the time, one error ripples across agency after agency and just creates a tremendous backlog.
Mr. Weise, as the committee continues to evaluate ways to improve trade processing and benefits to trusted traders, what other trade streamlining measures should we consider as a Trade Subcommittee? In fact, in your view how effective has the CBP been at consulting and working with other agencies and what, if anything, can Congress do to facilitate CBP’s collaboration with other agencies and the private sector?
Mr. Weise. As I said in my statement, I think Customs is doing much better than they have in the past in recent years, that is CBP. The creation of CBP, obviously in the aftermath of 9/11, their focus was pretty much security, security, security, and the concern was we might have a physical container with explosives, et cetera. So rightfully so. But they are doing a much better job. They have a number of outreach programs, they are reaching out to try to partner with the business community, but there is much more that can be done.
And I think, again, when you look at resources, the issue we were just talking about in terms of your centralized data, that is the International Trade Data System we tried to do back when I was Commissioner in the 1990s. The import community is being asked to do a lot in terms of doing C‑TPAT, putting in systems that will make sure that their supply chain is secure. What they are asking from the government is don’t be duplicative about the data you are asking for. You are asking for so much from so many sources. If you want us to do all this to help secure the supply chain, help us out by asking for data one time, it can be shared across all agencies, and then to Mr. Mullen’s point, all of the information that different agencies require aren’t critical for the release process. They may be critical at some point before these products enter consumption, but are not critical release.
Mr. Davis. Do you see the shippers actually being, or CBP actually sitting down with the shippers, business process managers, their systems people to actually see the ‑‑ you know, the level of granularity I think in many of the shippers is much more sophisticated than what the Federal Government actually uses, and I think a partnership could accomplish both ends very easily to speed that but also accomplish the same end.
Mr. Weise. Exactly. My point that I made in my testimony as well, it is more complicated. There is no unified voice anymore, even from a congressional perspective. You have the Ways and Means Committee and the Senate Finance Committee, having a particular focus on what CBP should be looking at and you have the Homeland Security Committees that may have a different perspective, so CBP is getting mixed signals.
To me one of the things that is lacking that I said in my submission is that we need to find a way to have communication consistent across the business community, CBP, and the Congress to make sure that there is a clear direction that is being provided and that people are being held accountable in CBP in carrying out those policies. I think that is what has been difficult because of all the complexity of this very much larger organization with all these different committees. There is not a unified message that is being received that needs to be carried out.
Mr. Davis. Great. Thank you very much. Yield back, Mr. Chairman.
Chairman Brady. Thank you. I think this hearing has been a good bipartisan opportunity to focus on the nuts and bolts of trade, making sure that Customs has the resources, the authority, and the focus on its trade enforcement missions as well as streamlining legitimate trade. Work of Customs is key in determining our competitiveness in the 21st century, and I very much thank the witnesses for their time and their patience and their very thoughtful testimony. Our record is open until May 31, 2012. I urge interested parties to submit statements to inform our Customs authorization legislation, included as I requested on the measurements, the indicators that we might consider on making sure we are actually measuring the progress.
With that, thank you. This hearing is adjourned.
[Whereupon, at 12:21 p.m., the subcommittee was adjourned.]
Members Submissions For The Record
The Honorable Charles Boustany Letter 1
The Honorable Charles Boustany Letter 2
Senators Ron Wyden, Olympia Snowe, Claire McCaskill, and Roy Blunt
Public Submissions For The Record