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Recent Controversy Brings Renewed Government Interest in PORT Security



cargo changes likely for importers/exporters



By Peter Mayberry and Jessica Franken



Published June 15, 2006
Related Searches: nonwovens INDA nonwoven Legal / Regulatory
Abraham Lincoln once noted that, "Public sentiment is everything. With public sentiment nothing can fail; without it nothing can succeed." And if anyone doubts the wisdom of this statement, a good demonstration can be found in the Dubai ports controversy.

Indeed, when it was revealed earlier this year that the Bush Administration had approved a deal allowing Dubai Ports World (DP World)—a management firm owned by the government of the United Arab Emirates (UAE) to take over operational management of six maritime ports in the U.S., public opinion polls revealed that more than 80% of Americans disapproved of the deal. Shortly thereafter, lawmakers on both sides of the political aisle lined up to take shots at the administration's decision, and the deal was eventually scuttled.

But all the hoopla surrounding this doomed venture also had the secondary effect of refocusing attention on the general issue of port security reform which had waned somewhat even though government studies show that only 5% of the 11 million-plus containers that came into U.S. ports during 2005 were inspected by U.S. Customs agents, and security measures adopted in the wake of September 11 by the U.S. Department of Homeland Security had come under fire from Congressional investigators.

As Rep. Dan Lungren (R-CA), who chairs a Congressional Subcommittee with jurisdiction over the protection of U.S. infrastructure, explained, "The hullabaloo surrounding the Dubai Ports World deal injected a sense of urgency into the need for important port-security reform." The specific response being that port-security reform legislation has emereged in both chambers of Congress during the past three months. In addition, efforts undertaken during the past five years by various agencies within the Federal government has also been directed at tightening the security of our maritime ports.

Realizing the importance of international trade and global supply chains to the nonwovens industry—and that the implications of any port security reform effort can be tremendously significant to our industry—this article will summarize several of the port security initiatives under consideration in both the Executive and Legislative branches of our government.

C-TPAT and CSI



Launched by U.S. Customs in 2002, the C-TPAT is a voluntary program open to U.S.- and foreign-based companies whose goods are shipped to the U.S. via air, rail, ocean and truck carriers. Participating firms agree to improve the security of their supply chains in return for a reduced likelihood that their containers will be inspected.  

To determine eligibility for C-TPAT participation and benefits, Customs uses a two-pronged approach that includes "certification" and then "validation." During the certification step, Customs officials review the firm's application and perform a background check. Following a successful review, an applicant is deemed "certified" by Customs, and is granted benefits such as a reduced score on the Agency's risk-targeting system. During the validation phase, Customs also conducts an on-site review of the company's security plan in action. Firms that pass are validated and then receive the lowest risk-targeting score possible, which substantially lowers their chances of being inspected and means expedited processes when inspections are conducted.

Supporters of this program point to the nearly 10,000 companies that have applied to be part of this voluntary initiative as evidence of its success. But critics counter that less than one-third of the participating companies have undergone validation, which means the majority of applicants are receiving C-TPAT benefits without undergoing a thorough, on-site review to ensure that their security practices pass muster.

Then there is the Container Security Initiative (CSI), a program that Customs also initiated in 2002, that relies on voluntary cooperation by foreign governments to allow U.S. Customs agents to be stationed at ports in other countries so that they can target and screen U.S.-bound containers deemed to be "high risk." Under CSI, agents rely upon a combination of automated targeting tools such as advance cargo manifest information and strategic intelligence as well as physical screening technologies including X-ray, gamma ray and radiation detection devices to identify containers that pose a potential risk for terrorism. Some 44 foreign ports handling nearly 75% of all shipments coming into the U.S. are presently participating in the program, according to Customs, and the agency hopes to have 50 ports signed on by the end of 2006.

But critics including auditors in the Government Accountability Office and investigators for the Senate's Permanent Subcommittee on Investigations say that less than 20% of "high-risk" containers are being given follow-up inspections by U.S. officials overseas.

And, when U.S Customs agents attempt to more thoroughly inspect high-risk containers overseas, they often find their effort thwarted by foreign port officials. On top of all this, critics point out, there is also a great deal of variation in the quality and type of screening devices being used at the various ports, which means some high risk containers potentially may be slipping past unrecognized.

SAFE Port Act and Green Lane Bill



As previously noted, legislation has recently been introduced in the U.S. House of Representatives and the U.S. Senate that seeks to address the kinds of problems described above. Moreover, on May 4 of this year, the "Security and Accountability For Every Port Act" (H.R. 4954 or "SAFE Port Act" for short), passed the House by an overwhelmingly lopsided vote of 421-2. The SAFE Port Act proposes to create a "GreenLane" at ports that would expedite the Customs process for foreign and domestic supply chain participants who meet the highest level of security and volunteer to participate. In addition, the bill sets minimum security standards for all cargo containers entering the U.S., and requires enhanced radiation monitoring at all ports. The bill also seeks to shore up many of the existing weaknesses in the existing CSI and C-TPAT.

Meanwhile, on May 2, the "GreenLane Maritime Security Act" (S. 2459 or "GreenLane" for short), was approved by the Senate Committee on Homeland Security and Governmental Affairs Committee, which means the measure will likely be considered by the entire Senate soon. And, while the Senate bill shares many of the same provisions found in the House bill, there is one key difference. The GreenLane bill would require that every sea cargo container be screened for radioactive materials before leaving its port of origin, and that stronger seals be placed on containers to prevent tampering before they reach U.S. shores. But these provisions could harm the bill's chances of ultimately being enacted considering sentiments expressed in the U.S. House of Representatives that such requirements are unrealistic and would do more harm than good. As House Majority Leader John Boehner (R-OH) recently noted, "100% screening of every container is not at all practical and will, in fact, shut down our ports and undermine the strong economy that we have today."

Those who support comprehensive screening programs counter that the technology exists to efficiently and economically inspect every cargo container before it enters the U.S., so it remains to be seen how the issue will be resolved.

Looking Ahead



Now that legislation has been passed in the House of Representatives, and anticipating that a similar yet not identical bill will be approved by the Senate, it will be necessary to convene a legislative conference of members from both chambers of Congress to work out any differences.

While it is purely speculative to predict which provisions will survive the wrangling that will occur as the conferees struggle to reconcile the differing measures, two things can be said with some certainty: 1) anyone who ships containers into the U.S. can expect to see some changes in the way those containers are handled in the near future; and 2) INDA, Association of the Nonwoven Fabrics Industry, will be keeping its members informed about these changes as they develop.
Peter Mayberry's column appears monthly in Nonwovens Industry.