GAO criticizes lack of analysis by DHS into roll out of rule, while Napolitano delays action until 2012
GAO recently issued a report on the progress made by DHS to prepare for the roll out of the 100% container scanning rule, part of the SAFE Ports Act of 2007. The study focused on the progress of the Secure Freight Initiative (SFI) as a sort of pilot project of the wider rule. The report found that the SFI program is being carried out with limited success in five international ports, three representing relatively low volume of total container traffic to the US, and two representing high volume ports. Even in the low volume ports 100% had not been achieved, whereas in the high volume ports less than 5% is being scanned.
The 100% scanning rule has been the subject of controversy since it was approved by congress. Many business leaders, foreign government officials, logistics professionals and CBP itself have expressed strong concern about the viability of this project, its actual effectiveness, the cost of implementation, and the international policy implications of a program with heavy costs for foreign governments. According to an article in Logistics Management “’ "[The GAO} findings are absolutely not surprising at all,’ said Albert Saphir, president of international trade consultants ABS Consulting in Fort Lauderdale, Fla. ‘Any practical on the ground study, approach or discussion certainly all point in the same direction in that the mandate that was put out...cannot be met. We cannot impose U.S. law onto foreign soil…’” (See link to full article below)
The GAO report went on to find the following points:
- CBP has made limited progress in scanning containers at the initial ports participating in the SFI program, leaving the feasibility of 100 percent scanning largely unproven
- CBP has not developed a plan to scan 100 percent of U.S.-bound container cargo by 2012, but has a strategy to expand SFI to select ports where it will mitigate the greatest risk of WMD entering the United States.
- CBP, while identifying some SFI program costs, has not developed a complete estimate of U.S. program costs because of the lack of a decision on a clear path forward.
- CPB faces a number of potential challenges in integrating the 100 percent scanning requirement into its existing container security programs
In concluding, GAO recommends CBP “complete a feasibility analysis, cost estimates, and a cost-benefit analysis, and provide these results to Congress.”
In a related news item, Janet Napolitano, Secretary of Homeland Security, announced that DHS will issue a two year extension for requiring the 100% cargo scanning rule to be implemented in all ports where US imports originate. As reported in an article in Sandler, Travis and Rosenberg, “Napolitano said meeting this deadline with existing resources and technology is virtually impossible due to numerous challenges” and that “[a]according to reports, there was little opposition to Napolitano’s plan among senators attending the hearing.” This last point is interesting, as it indicates that among the congress members who are aware of the challenges, this delay tactic was anticipated and not entirely unwelcome. The fact that these possible extensions were built into the legislation from the beginning seems to point to a realization by Congress that this legislation would not be enforeceable for years to come.
Moreover, apart from the aforementioned concerns with the 100% scanning rule, CBP has speculated that it have the negative and somewhat perverse effect on supply chain security in that it will reduce the incentive for partners to participate in the SFI, CSI or C-TPAT program. As mentioned in the ST&R article, the requirement of scanning all cargo in ports of origin essentially negates any incentive for companies to dedicate resources to implementing a minimum security standard throughout their company or their supply chain, as they will not receive noticeably fewer security inspections that non-C-TPAT members.
While this action by DHS essentially “kicks the can down the road”, the question remains what will need to take place in the long run: whether DHS must eventually enforce the rule, or whether Congress will have to reverse its decision regarding this contentious issue.
1. SUPPLY CHAIN SECURITY: Feasibility and Cost-Benefit Analysis Would Assist DHS and Congress in Assessing and Implementing the Requirement to Scan 100 Percent of U.S.-Bound Containers
United States Government Accountability Office, Report to Congressional Requesters. October 2009.
2. Ocean shipping/cargo security: GAO report indicates 100 percent cargo scanning has a long way to go Jeff Berman, Group News Editor -- Logistics Management, 12/3/2009
3. DHS to Push Back Deadline for 100% Cargo Scanning
World Trade Interactive
Sandler, Travis and Rosenberg