NAM Urges DHS To Conduct Pilot Program for "10+2" Rule

“The rule requires 10 new categories of data on U.S.-bound shipments 24 hours before loading in foreign ports,” said Catherine Robinson, associate director for High Tech Trade Policy at NAM. “That would add tremendous cost to U.S. manufacturing at a time when increasing global competition and a slowing domestic economy are creating new stresses on U.S.-based manufacturers from every sector. National security and trade facilitation need not be mutually exclusive. National security can be enhanced without impeding commerce.

Robinson said a prototype program would enable customs to “get it right” and save U.S. business and the government from having to make multiple changes to their operations. “A prototype program is the best method for evaluating the impact of the proposed rule and for identifying ways to improve the rule before the government and industry invest billions of dollars to comply,” she added, as well as allowing the government to “carefully assess any security risks that will arise from implementation of the proposed rule.”

“There is significant precedent for requiring a prototype program for new CBP rules, and the majority of its major initiatives have benefited from such testing,” Robinson said. “This rule should be afforded the same treatment.

NAM claims the proposed rule will create significant delays in the supply chain and will cost U.S. companies over $20 billion annually, costs the organization says will be passed down to the consumer at a time when many can least afford it.

DHS Secretary Michael Chertoff, in a speech at the U.S. Customs and Border Protection 2007 Trade Symposium, called the 10+2 rule “a way of providing supply-chain transparency back to the point of stuffing more information at an earlier stage of the process.  And therefore it helps us fill some existing knowledge gaps about cargo movements and the parties who may have had access to the shipment.”

According to NAM President John Engler, “Department of Homeland Security Secretary Chertoff needs to step back and take a hard look at this rule. It could have a serious impact on our economy and national security. The NAM is more than willing to work with DHS and CBP to improve the rule.”

A bipartisan group of 20 members of Congress led by Rep. Earl Blumenauer (D-Oreg.) sent a letter to Secretary Chertoff urging DHS and CBP to carefully consider the unintended consequences of the proposed 10+2 rule.
 
 “A rigorous pilot program would also allow the government to carefully assess any security risks that will arise from implementation of the proposed rule,” Engler continued. “As the rule is proposed, containers will sit in foreign ports for several days awaiting clearance from CBP. This greatly increases the opportunity for the containers to be tampered with while at the foreign port. The NAM remains concerned that freight at rest is freight at risk.”

Engler noted that many importers “have gone to great lengths and worked tirelessly with CBP to secure their supply chains. Unfortunately, the proposed rule does not utilize risk management principles by treating all importers from first time importers to Customs Trade Partnership Against Terrorism CTPAT validated importers alike.”