SGMA: U.S. Customs Encourages C-TPAT Verification Between Businesses

The U.S. Bureau of Customs and Border Protection (“Customs”) has established the Status Verification Interface (“SVI”) in the Customs-Trade Partnership Against Terrorism (“CTPAT”) section of its internet website. The SVI will allow C-TPAT members to easily confirm whether their suppliers or carriers are C-TPAT participants. Moreover, the SVI is an apparent effort by Customs to encourage companies to condition business relationships on C-TPAT membership.

C-TPAT is a program under which importers and carriers agree to develop and implement security measures throughout each of their supply chains. These measures include self-assessing security systems, submitting security questionnaires to Customs, developing
security enhancement plans, and communicating C-TPAT guidelines to companies in the supply chain. The C-TPAT program is voluntary. However, Customs has vigorously solicited the participation of large importers, explaining that C-TPAT membership will reduce border inspections and wait times. Moreover, Customs has already conditioned participation in other initiatives (such as the importer self-assessment program) on C-TPAT membership. C-TPAT
membership is currently available to carriers and U.S. importers as well as manufacturers in Mexico. Initially, Customs has opened C-TPAT membership to manufacturers outside the United States and Mexico by invitation only. Customs is expected to expand C-TPAT to other
manufacturers in the future.

Through the internet-based SVI, C-TPAT participants can verify the C-TPAT status of other companies. Although information submitted under the C-TPAT program is held
confidential by Customs, companies may voluntarily provide their C-TPAT user ID (issued by Customs) to each other, so that C-TPAT compliance can be verified on a business-to-business basis. C-TPAT participants can verify the status of other participants by entering the provided
user ID into the SVI.

Customs’ creation of the SVI represents two important developments. First, companies already participating in C-TPAT now have a relatively simple method to verify the security of a particular supply chain. A C-TPAT member company wishing to confirm the security of a particular supply chain or segment will have met its responsibility by finding the relevant supplier or carrier listed in the SVI. Second, Customs is apparently encouraging companies to
discuss C-TPAT status prior to commercial transactions. As a result, companies that are not yet C-TPAT members should expect that their customers may begin to request SVI identification data as a part of the process for qualifying suppliers and carriers.

The SVI is located at: www.cbp.gov/xp/cgov/import/commercial_enforcement/ctpat/svi/.