U.S. Customs and Border Protection has nearly completed a plan to tighten oversight of in-bond shipments to address congressional concerns, Assistant Commissioner Thomas Winkowski told a Senate panel on Thursday.
The agency is three months late reporting to Congress about fixes to the duty-deferral program, as required by the SAFE Port Act last year.
By securing a bond guaranteeing delivery at a designated point and time, importers can bypass the formal entry process and transport imported goods from one port of entry to an inland destination, or even another port for re-export to another country. Similarly, shippers can store the goods in a specially designated warehouse until they are ready for consumption, or use at a later time in exchange for a bond guaranteeing payment of duties and taxes. The in-bond process appeals to shippers because they can get their goods faster without having to wait for clearance at congested ports, and because it allows them to manage their cash flow, as opposed to the traditional practice of paying duties up front at the point of entry.
The Government Accountability Office earlier this year said that CBP does not have processes in place to match documents at the arrival port with those at the destination port to ensure that the cargo is officially entered into commerce with appropriate duties or quotas applied. Smugglers frequently slip shipments through the system without arriving at the inland port of entry.
According to the GAO, one port of entry reported that 77 percent of its in-bond transactions never closed.
Winkowski said at a hearing of the Senate Commerce, Science and Transportation Committee that the final report will address the following subjects:
* Number of personnel needed to reconcile all documentation between the arrival and destination ports.
* Status of investigations of overdue in-bond shipments and an assessment of the resources needed to pursue overdue shipments.
* A plan for tracking in-bond cargo using the new Automated Commercial Environment information system.
* An assessment of whether any particular technologies should be required in the transport of in-bond cargo.
* Whether ports of arrival should require any additional information for in-bond movements.
* A review of the criteria for targeting and examining in-bond cargo.
* A feasibility assessment of reducing the transit time for in-bond shipments, including an assessment of the impact of such a change on domestic and international trade.
CBP is also reviewing whether to give in-bond shipments a higher risk score when determining which boxes to scan or inspect to make sure they match the manifest, Winkowski said in his prepared testimony.