TSA’s Risk-Based Approach for International Inbound Cargo

1. TSA’s Risk-Based Approach for International Inbound Cargo

2. Agenda

3. Risk-Based Framework for Securing the Global Supply Chain

4. Risk-Based Framework for Securing the Global Supply Chain • Department of Homeland Security (DHS) Secretary working groups were established in early 2011 to provide recommendations on air cargo security • Building upon existing risk-based efforts, in January 2012, DHS released The National Strategy for Global Supply Chain Security outlining clear goals to promote the efficient and secure movement of goods and foster a resilient supply chain system. Efforts will be guided by three key principles: • Finding smarter and more cost effective ways to address security threats and maximize resources/expertise from across the United States Government • Fostering an all-of-nation approach to leverage the critical roles played by state, local, tribal and territorial governments, and private sector partners in strengthening supply chains; and • Enhancing coordination with the international community and international stakeholders who also have key supply chain roles and responsibilities “The key to evaluating potential risk is information—by sharing and leveraging information we can make informed decisions about how to best mitigate risk. And the more we know the better we become at providing security that is seamless and efficient” DHS Secretary Janet Napolitano, January 2012

5. Risk-Based Framework for Securing the Global Supply Chain (con’t) • TSA is incorporating the risk-based approach to achieve 100% screening of international inbound cargo on passenger aircraft • Risk-based analysis of shipments and shippers to determine tiered screening protocols • All cargo designated as higher-risk will undergo enhanced screening using approved screening methods, while lower-risk shipments will be required to undergo alternate physical screening • 100% of international inbound cargo shipments will be physically screened • In February 2012, TSA issued proposed enhanced security measures, building on the extensive screening procedures already in place, for 100% risk-based screening of international inbound cargo on passenger aircraft. The measures included a potential implementation date of December 1, 2012 • TSA is requesting feedback from the airline industry, which will be reviewed before determining whether or not to implement this date • TSA is also incorporating the risk-based approach for all-cargo carriers inbound to the US • TSA will focus on directing screening to “elevated risk” shipments • Unlike for passenger aircraft, 100% screening does not apply to all-cargo aircraft under the 9/11 Act

6. Air Cargo Advance Screening (ACAS)

7. ACAS - Overview • TSA regulates the Air Carrier – While the ACAS pilot may include Freight Forwarders and other entities in the air cargo supply chain, TSA regulates only the Carrier • Only the Carrier (or their Authorized Representatives) may screen cargo • National Cargo Security Program • TSA is neutral regarding who submits data (carrier or forwarder) • TSA requires confirmation of screening – In order to complete the referral process, a screening confirmation message must be submitted by the Carrier to ACAS (for higher risk shipments)

8. ACAS - Carrier Screening Model ACAS 2 1 Communication AMS Data Carrier Dual Filing; Carrier Single Filing; Freight Forwarder Filing Shipment Action Carrier 3 4 5 • Data is filed with ACAS • ACAS conducts baseline threshold targeting • Upon completion of analysis, ACAS may require one of three different action options: • Data Quality Update Requested • Screen Protocols • Do Not Load • Air Carrier or its Authorized Representative screens the shipment per current TSA Standard Security Programs • Screened cargo can be loaded

9. NCSP Screening Model ACAS 2 1 Communication AMS Data Carrier Dual Filing; Carrier Single Filing; Freight Forwarder Filing Shipment Action Carrier 3 4 5 • Data is filed with ACAS • ACAS conducts baseline threshold targeting • Upon completion of analysis, ACAS may require one of three different action options: • Data Quality Update Requested • Screen Protocols • Do Not Load • If the Freight Forwarder is a Regulated Agent performing screening under a TSA recognized National Cargo Security Program (NCSP), they may perform the screening prior to tendering to the Air Carrier, or tender it to the carrier for screening • Screened cargo can be loaded

10. ACAS - Challenges • ACAS is being piloted in multiple phases allowing TSA and CBP to work through key issues and challenges with each phase prior to full implementation Express Industry Pilot Passenger Air Carrier Pilot All-Cargo Pilot Freight Forwarder Participation

11. Summary

12. Summary • The 9/11 Act requires TSA to establish a system to ensure 100% screening of both domestic and international inbound cargo on passenger aircraft • In line with DHS’ National Strategy for Global Supply Chain Security, TSA has provided air carriers a path toward achieving 100% screening of international inbound cargo through risk-based analysis of shippers and shipments to determine tiered screening protocols • Applies to passenger and all-cargo carriers • The ACAS platform provides data analysis and determines screening requirements • Data can be submitted by any party • Screening is conducted by regulated entities

13. Next Steps

14. Next Steps • TSA recently issued updated security programs to passenger carriers for comment • The programs encourage early adoption of ACAS in lieu of forwarder-provided paperwork • A risk determination drives screening protocols for passenger and all-cargo carriers • A data-driven (ACAS), risk-based approach is essential to security and to attaining 100% screening