Locking down contracts and auditing are absolutely key, say security experts Over the years, organisations have outsourced a wide range of services, generally because third parties can manage them more efficiently and cost-effectively than they can themselves. As a result, security and regulatory requirements have increased substantially. For IT departments, securing information in the supply [...]
Locking down contracts and auditing are absolutely key, say security experts
Over the years, organisations have outsourced a wide range of services, generally because third parties can manage them more efficiently and cost-effectively than they can themselves. As a result, security and regulatory requirements have increased substantially.
For IT departments, securing information in the supply chain is one of the biggest challenges they face today. This is because supply chains are composed of various companies, all of which have their own set of security standards, and organisations struggle to communicate their requirements to all of these different parties.
One way to approach the problem is to assess the “risk appetite” of your organisation, according to Mark Pearce, Head of Information Security at the Post Office. In other words, the IT department needs to work out what the board is prepared to accept in terms of risk, and balance that with with the amount of innovation the business requires.
Click here to read the complete article.
Source: Sophie Curtis | Techworld
Unified Global Security: The Challenge Ahead U.S. Customs and Border Protection (CBP) hosted the annual Customs-Trade Partnership Against Terrorism (C-TPAT) conference last week to discuss the unified approach to securing the global supply chain and best practices to address challenges ahead. More than 1,200 participants from the private sector joined the conference which was held [...]
Unified Global Security: The Challenge Ahead
U.S. Customs and Border Protection (CBP) hosted the annual Customs-Trade Partnership Against Terrorism (C-TPAT) conference last week to discuss the unified approach to securing the global supply chain and best practices to address challenges ahead. More than 1,200 participants from the private sector joined the conference which was held in National Harbor, Md.
“C-TPAT is really at the heart of where we are going with the country’s national effort on global supply chain security,” said CBP Acting Chief Operating Officer Thomas S. Winkowski. “The program allows us to work together to address risk at the earliest point of the supply chain process while expediting trade. It keeps our nation safe and promotes economic competitiveness.”
Richard Reed, deputy assistant to the president for Homeland Security, also shared his thoughts on the value of programs like C-TPAT for both government and industry to enhance not only the security of critical infrastructure, but also resiliency and response. Reed cited Hurricane Sandy as an example of the private/public partnership working hand-in-hand to re-constitute trade and travel at our ports of entry. Additional keynote speakers at the conference included CBP Acting Assistant Commissioner for the Office of Field Operations, Kevin K. McAleenan, who announced the selection of Ms. Lauren M. Kaufer as the new C-TPAT director.
After the 9/11 tragedy, the biggest challenge CBP faced was securing imports from terrorist infiltration via smuggling of weapons, terrorists, or weapons of mass effect. C-TPAT is a voluntary government-business initiative to build cooperative relationships that strengthen and improve overall international supply chain and U.S. border security. C-TPAT recognized that U.S. Customs and Border Protection can provide the highest level of cargo security only through close cooperation with the ultimate owners of the international supply chain such as importers, carriers, consolidators, licensed customs brokers, and manufacturers. The C-TPAT program is one layer in CBP’s multi-layered cargo enforcement strategy. Today, the program has nearly 10,500 members, 700 of which joined this past year.
The first international conference on the new trade paradigm, mainly referring to the Authorized Economic Operator, kicked off in Korea on Tuesday. About 800 senior public officials, business leaders and professors from around the world are attending the three-day forum co-hosted by the World Customs Organization and the Korea Customs Service. The conference is drawing [...]
The first international conference on the new trade paradigm, mainly referring to the Authorized Economic Operator, kicked off in Korea on Tuesday.
About 800 senior public officials, business leaders and professors from around the world are attending the three-day forum co-hosted by the World Customs Organization and the Korea Customs Service.
The conference is drawing interest as this marks the first global gathering since a group of customs authorities officially introduced the so-called AEO concept in 2005.
The AEO indicates a party involved in the international movement of goods that has been approved by a national customs administration as complying with World Customs Organization or equivalent supply chain security standards.Among them are all stakeholder groups such as importers, exporters, brokers, carriers, consolidators, intermediaries, ports, airports, terminal operators, integrated operators, warehouses and distributors.
Aimed at improving the efficiency of customs administration and increasing the safety of trade goods, the program offers AEOs diverse benefits such as quicker customs clearance and exemption from customs check-ups, while tightening surveillance on unauthorized products or companies for potential security threats.
Since the U.S. adopted the program in the aftermath of the Sept. 11 terrorist attacks in 2001, 54 countries around the world have joined that comprise about 77 percent of global trade volume. Countries adopt the AEO program for different reasons according to their individual situations.The U.S. focuses more on supply chain security, while countries like Japan and New Zealand prioritize supporting their exporting countries. Others including Korea, China and EU seek both purposes.
U.S. Customs and Border Protection posted to its Web site recently its 2011 C-TPAT Costs & Savings Survey. CBP concludes from the review that C-TPAT “has become a vital part of supply chain security in the post-9/11 world” and that the program membership “continues to be a critical source of feedback and recommendations for improvement.” CBP [...]
U.S. Customs and Border Protection posted to its Web site recently its 2011 C-TPAT Costs & Savings Survey. CBP concludes from the review that C-TPAT “has become a vital part of supply chain security in the post-9/11 world” and that the program membership “continues to be a critical source of feedback and recommendations for improvement.”
CBP states that the “overarching theme” of this survey is that “the value of C-TPAT membership cannot be measured adequately in terms of dollars and cents.” On the one hand, there are indeed implementation costs and maintenance costs, which are offset by savings in only a minority of cases.
In addition, a “non-ignorable minority of respondents” said they have not seen the expected improvements in processes that impact their profitability, such as faster border crossings, front-of-the-line programs and less-frequent inspections. At the same time, CBP said, “it is clear that C-TPAT members take pride in their membership, see it as an industry best practice and value it for reasons that go beyond a purely monetary frame of reference.” These reasons include a best-practice approach to security issues that creates a business culture of more secure operations for all and constant improvements in security, the assurance that shipments will move predictably, reduced exposure to legal or financial risk, and the indirect benefits of efficiency and safety resulting from security activities that reveal equipment or personnel issues that do not directly impact security.
Other information revealed through this survey includes the following.
• Small numbers of importers and carriers reported their estimates of the costs of border delays in four different modes of transport. The median costs were $200 for land delays, $500 for air delays, $1,000 for rail delays and $1,500 for sea delays.
• CBP asked what percentage of contracts for supply chain relationships these days require bidders to be C-TPAT certified. Eight percent of respondents said all of them while 9% said none. About 40% of respondents put the figure between 1% and 45% and about 30% said it was between 50% and 99%.
• For the 75% of respondents who reported a dollar value for implementation costs related to C-TPAT membership, those costs ranged from $280 to $4 million, with a median of $17,370. For the 62% who reported a dollar value for maintenance costs, those costs ranged from $45 to $815,000, with a median of $9,000.
• For the 26% of respondents who reported a number of person-hours for time savings related to C-TPAT membership, those savings ranged from 25 to 48,000 person-hours annually with a median of 373. For the 24% who reported a dollar value for cost savings, those savings ranged from $50 to $52 million, with a median of $5,350.
• Asked to summarize the financial costs and savings related to C-TPAT membership as net positive, neutral or net negative, respondents fell about equally into each category.
Source: STR Trade Report
U.S. Customs and Border Protection recently advised members of the Customs-Trade Partnership Against Terrorism that effective March 1 the current International Organization for Standardization (ISO) mechanical seal standard (ISO/PAS 17712) will be replaced with new standard ISO 17712:2010. CBP is not requiring C-TPAT participants to discard any high-security container seals that may not comply with [...]
U.S. Customs and Border Protection recently advised members of the Customs-Trade Partnership Against Terrorism that effective March 1 the current International Organization for Standardization (ISO) mechanical seal standard (ISO/PAS 17712) will be replaced with new standard ISO 17712:2010.
CBP is not requiring C-TPAT participants to discard any high-security container seals that may not comply with the new standard that are currently in stock but is encouraging them to purchase compliant seals when their existing stocks are exhausted. CBP also states that when C-TPAT companies transition to new seals they should request documentation (lab reports) to confirm that the seals comply with the new standard.
CBP states that the updated standard includes the following requirements: testing to determine a seal’s classification for physical strength (as a barrier of entry), process auditing of the manufacturer’s security-related business practices, testing (pass/fail) of a seal’s ability to indicate evidence of tampering, and a new 18mm minimum width diameter for bolt seals.
CBP adds that benefits of complying with the revised standard include a reduced possibility of cargo theft or tampering, fewer shipping delays resulting from missing or broken seals, and easier detection of compromised seals.
Source: STR Trade Report
Earlier this year, Mexican Customs (Administración General de Aduanas) began a pilot for its new trusted shipper program designed to accelerate the crossing and inspection process at international bridges. The Nuevo Esquema de Empresas Certificadas, or NEEC, is a voluntary trusted shipper program that offers participating companies fewer inspections and faster clearances for meeting specified [...]
Earlier this year, Mexican Customs (Administración General de Aduanas) began a pilot for its new trusted shipper program designed to accelerate the crossing and inspection process at international bridges.
The Nuevo Esquema de Empresas Certificadas, or NEEC, is a voluntary trusted shipper program that offers participating companies fewer inspections and faster clearances for meeting specified requirements at international ports of entry.
The program is modeled after the U.S. C-TPAT (Customs-Trade Partnership Against Terrorism) certification program that allows bridge-crossers to use the FAST lanes, skipping to the front of long lines and potentially bypassing time-consuming inspections. Short for Free and Secure Trade, the post-9/11 program was a joint effort between the U.S. government, the truck driver, the carrier, the manufacturer and the importer.
While C-TPAT has been in place for northbound traffic from Mexico since 2002, there has not been a similar program for southbound traffic. The Tax Administration Service, or SAT, the Mexican agency that oversees customs, worked to develop its own program; one that U.S. trade officials say will benefit trucks carrying U.S. exports across the border.
The NEEC, program is expected to officially open up to all interested participants later this month. Companies with business operations in Mexico that are already C-TPAT certified will be well positioned to take advantage of participation in NEEC – but is your company ready for this?
To find out more about the NEEC and if your company is ready to participate, join Karen Lobdell, Director – Global Solutions at Integration Point Inc. for a one-hour webcast on November 30th, as she discusses:
• Program history and objectives
• Requirements for participation
• Minimum security standards
• Application procedures and scope
• Next steps
• Tools available to assist with participating in the NEEC and other security programs
This webcast will be held on Wednesday, November 30, 2011 at 11:00 a.m. EST/ 8:00 a.m. PST.
For more information and to register, click here.
Earlier this month, Simon Kaye, CEO of Jaguar Freight Services, a New York based supply chain solution provider (or “freight architect” as the company somewhat fancifully styles itself), wrote a very incisive piece on the IFW website broadly describing the contours of today’s security environment relative to logistics. Essentially, the gist of his article was [...]
Earlier this month, Simon Kaye, CEO of Jaguar Freight Services, a New York based supply chain solution provider (or “freight architect” as the company somewhat fancifully styles itself), wrote a very incisive piece on the IFW website broadly describing the contours of today’s security environment relative to logistics. Essentially, the gist of his article was that companies which fail to incorporate the most advanced technology and standardized security processes into their supply chain leave themselves needlessly vulnerable to the growing risk of cargo theft (see footnote below).
To combat the problem, Kaye recommended that companies implement a formal methodology such as the comprehensive and widely accepted International Organization for Standardization (ISO) 28000 framework for dealing with supply chain security management combined with deployment of the required technology needed to ensure its practical efficacy. Depending on circumstance, this technology may involve sophisticated electronic tracking and “geofencing” systems utilizing RFID and GPS technology or the implementation of more basic physical security devices such as communication enhanced electronic seals.
Aside from the obvious benefit of curtailing the risk of loss from theft that may be derived from taking such security precautions, Kaye also pointed out the important linkage that has developed in recent years between logistics security and customs compliance as regulatory agencies in North America and around the world increasingly utilize electronic communication between customs and business users to correlate and verify import/export declaration data.
Sophisticated technology is integral to unified customs/security processes for many major importing countries. The U.S. Customs and Border Protection agency (CBP) has created an Importer Security Filing (ISF) on maritime cargo that requires importers to submit advance security-related shipment information electronically, including detailed line item identification.
Similarly CBP’s Customs-Trade Partnership Against Terrorism (C-TPAT) is a cooperative cargo security effort encompassing the full supply-chain to ensure the integrity of security practices, and communicate and verify shipment information electronically. And U.S. government standards mandate 100% security screening of all cargo transported on aircraft, with select forwarders approved by the Transportation Security Administration (TSA) to use electronics to document the integrity of a shipment through stringent chain of custody methods.
With respect to trade compliance, Kaye’s conclusion is most pertinent to us here:
The international economy relies on the secure and efficient movement of goods through an increasingly extended multimodal transport system. The information required by ISO standards and complex customs regulations demands that shippers and logistics companies use sophisticated electronic tools. Government security and customs agencies are generally in synch with logistics organizations that know how to collect freight tracking and compliance data in a way that creates a provable, thorough and secure electronic trail.
That last sentence (highlighted for effect) is not only critically important to appreciating the mindset of regulatory administrations as regards to determining what constitutes a “trusted trader” for the purposes extending preferential customs treatment and expedited release at the border, but is essential for companies to take on board as a best practice when it comes to minimizing their exposure to risk by means of verifiable compliance standards and accountability measures.
Footnote: According to FreightWatch’s 2010 Annual Cargo Theft Report, industry-wide cargo theft rose by 4.1% in 2010. The food and beverage industry was the hardest hit, accounting for nearly 21% of the total theft activity, with an average loss value of $125,000 per incident. Electronics accounted for 19% of all cargo theft with an average loss per incident of $512,000.
India’s Central Board of Excise and Customs (CBEC) last month announced a new ‘Authorised Economic Operator’ (AEO) program, with a view to give AEO-certified operators preferential treatment in terms of less Customs examination, relaxed procedural requirements, etc, subject to the operators maintaining prescribed security standards and compliance requirements. The voluntary scheme is available to importers, [...]
India’s Central Board of Excise and Customs (CBEC) last month announced a new ‘Authorised Economic Operator’ (AEO) program, with a view to give AEO-certified operators preferential treatment in terms of less Customs examination, relaxed procedural requirements, etc, subject to the operators maintaining prescribed security standards and compliance requirements.
The voluntary scheme is available to importers, exporters, warehouse owners, custom house agents, cargo forwarders, carriers, port operators and couriers, among others in the trade community. Companies can obtain an internationally recognized quality mark, which will indicate their secure role in the international supply chain and that their Customs procedures are efficient and compliant. Thereafter, they will be considered ‘secure’ traders and reliable trading partners.
The AEO program has been developed pursuant to guidelines of the World Customs Organization’s (WCO) adoption of SAFE FoS (Framework of Standard) in 2005. The objective was ensuring security in the global supply chain from the point of origin i.e., the point of export to the point of import in the receiving country, keeping in view national requirements of respective administrations. SAFE seeks to establish standards that provide supply chain security and facilitation at a global level to promote certainty and predictability, enable integrated supply chain management for all modes of transport, enhance the role, functions and capabilities of Customs to meet the challenges and opportunities of the 21st century, strengthen cooperation between Customs administrations to improve their capability to detect high-risk consignments, strengthen Customs/Business cooperation and promote the seamless movement of goods through secure international trade supply chains. Continue reading »
(Industry Week – Josh Cable) Prior to the March disaster in Japan, Xirallic – a popular pigment that gives cars a pearly shine – was manufactured at just one factory in the world. Production of the pigment, which is made by German chemical company Merck KGaA, took place at a factory in Onahama, Japan, 57 [...]
(Industry Week – Josh Cable)
Prior to the March disaster in Japan, Xirallic – a popular pigment that gives cars a pearly shine – was manufactured at just one factory in the world.
Production of the pigment, which is made by German chemical company Merck KGaA, took place at a factory in Onahama, Japan, 57 kilometers south of the Fukushima Daiichi nuclear-power plant. The damaged pigment plant had to close, causing some automakers to temporarily restrict orders on vehicles in certain shades of black, red and other colors.
The plant resumed production in June, and Merck plans to add a production line in Germany. But the factory’s temporary closure is a perfect example of why the term “supply chain disruption” became a permanent part of the manufacturing vocabulary after the crisis.
And it highlights the need for manufacturers to rethink their supply chain strategies in a climate of instability, a new PwC report warns. Read more here.
