What is C-TPAT?

C-TPAT or Customs / Trade Partnership Against Terrorism is a voluntary public-private sector partnership program established in November of 2001 in an effort to prevent terrorism within the United States borders.  The program allows the CBP to work closely with certified, trusted partners in the trade community to better mitigate and prevent contraband, human smuggling, and potential attacks to the international supply chain.  When an organization joins C-TPAT, the company signs an agreement to work with CBP to protect the supply chain, identify security gaps, and implement specific security measures and best practices. C‐TPAT members are considered low‐risk and are therefore less likely to have their shipments examined.

What are the Benefits of C-TPAT Certification?

By taking an active role in working closely with the government, C-TPAT partners are able to better identify their own security vulnerabilities and take corrective action to mitigate risks.  Additional benefits from C-TPAT certification include:

  • Reduced number of CBP examinations
  • Front of the line inspections
  • Possible exemption from Stratified Exams
  • Shorter wait times at the border
  • Assignment of Supply Chain Security Specialist to the company
  • Access to the Free and Secure Trade (FAST) lanes at land borders
  • Access to the C-TPAT portal system and a library of training material
  • Importer eligibility to participate in the Importer Self Assessment Program (ISA)
  • Recognition as a trusted trade partner by foreign customs administrations and other corporate entities

Who Can Apply for C-TPAT Certification? 

  • U.S. Importers of Record
  • U.S. / Canada Highway Carriers
  • U.S. / Mexico Highway Carriers
  • Mexico Long Haul Highway Carriers
  • Rail, Sea, and Air Carriers
  • U.S. Maritime Port Authority and Terminal Operators
  • Mexican and Canadian Manufacturers
  • Licensed U.S. Customs Brokers
  • Third Party Logistics Providers
  • Consolidators / NVOCC
  • U.S. Exports (effective May 17, 2015)

How to Become C-TPAT Certified

To become C-TPAT certified, a company must first conduct and document a security risk assessment in order to determine the risks the company faces and how to mitigate those risks.  Upon completion of the risk assessment, a company must submit an application to CBP through the C-TPAT Portal System.  The company must complete a supply chain security profile which explains how the company is meeting C-TPAT’s minimum security criteria.  After filing the application and the security profile, a C-TPAT Supply Chain Specialist will be assigned to the company to review the materials and provide program guidance on an on-going basis.

How Does C-TPAT Compare to AEO?

AEO or Authorized Economic Operator is a party involved in international movement of goods that has been approved by a national Customs administration as complying with the standards of the World Customs Organization (WCO) or equivalent supply chain security standards.  Under Mutual Recognition Agreements, CBP can agree with a foreign Customs Administration to recognize AEO’s under the foreign Customs Administration’s supply chain security program.  This recognition allows for AEO’s under both C-TPAT and the foreign Customs Administrations program to receive reciprocal benefits through each program.

How Does C-TPAT Compare to NEEC?

The NEEC or Nuevo Esquema de Empresas Certificadas (New Certified Companies Scheme) is the Mexican counterpart to C-TPAT.  The NEEC is a voluntary business-government program aimed at fostering cooperation between the public and private sectors by establishing requirements that participants agree to meet in exchange for benefits such as a simplified cargo processing.  Under a Mutual Recognition Agreement, both Mexico and the United States agreed to provide companies enrolled in one program to receive reciprocal benefits under the other.   These benefits consist of fewer inspections, simplified approval processes for cargo, and reduced processing times for cargo trucks at the U.S. / Mexico border.  Because the NEEC was created as a C-TPAT counterpart, the certification requirements are very similar to C-TPAT.

Aaron Ambrite, Extern, Global Trade Expertis

What is C-TPAT?

 Customs-Trade Partnership Against Terrorism (C-TPAT) is a voluntary government/private sector program run by the U.S. Customs and Border Protection (CBP) that focuses on improving security and efficiency of international cargo. C-TPAT is meant to increase security measures, practices and procedures through all components of the international supply chain. The program requires certification of a participant by the CBP. 

Is C-TPAT for me? What are C-TPAT benefits?

As of November 2013, the program had approximately 10,500 participants  that account for over 50% of total U.S. imports (by value). The program participants include U.S. importers, U.S./Canada highway carriers, U.S. Mexico highway carriers, rail and sea carriers, licensed U.S. Customs brokers,  U.S. marine port authority/terminal operators, U.S. freight consolidators, ocean transportation intermediaries and non-operating common carriers, Mexican and Canadian manufacturers, and Mexican long-haul carriers. 

Some of the C-TPAT benefits include a decreased number of security and compliance inspections and reduced border wait times; front of the line privileges for examined cargo; eligibility to self-monitor security activities via Importer Self-Assessment (ISA) program; eligibility for FAST/dedicated lane access on the Canadian and Mexican borders with expedited cargo processing;  and business marketability as a CBP-certified company.  

 

What penalties apply to Customs violations?

 

Criminal Penalties

  • 18 U.S.C. § 1001 - Statements or Entries Generally - Punishable by recovery of duty loss plus a fine of $10,000 per count, imprisonment up to 5 years or both
  • 18 U.S.C. § 1542 - Entry of Goods by Means of False Statements - Punishable by recovery of duty loss plus a fine of $5000 per count, imprisonment up to 2 years, or both
  • 18 U.S.C. § 1545 - Smuggling Goods into the United States - Punishable by recovery of duty loss and seizure of goods plus a fine up to $250,000, imprisonment up to 5 years, or both

Civil Penalties

  • 19 U.S.C. § 1592 -Penalties for Fraud, Gross Negligence, and Negligence

Penalties for non-compliance are as follows based on the level of culpability:

Fraud - For violations resulting in a revenue loss = up to the domestic value of the entry(ies) ; for non-revenue loss violations = up to the domestic value of the merchandise. 

Gross Negligence - For violations resulting in a revenue loss = 4x the loss of duty; for non-revenue loss violations = 40% of the dutiable value of the merchandise.
 

 Negligence - For violations resulting in a revenue loss = 2x the loss of duty;  for non-revenue loss violations = 20% of the dutiable value of the merchandise.