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Customs - Trade Partnership Against Terrorism

Customs - Trade Partnership Against Terrorism. Ted Galantowicz International Trade Compliance Manager Emerson Corporate ITC Group. C-TPAT Overview. The Big Picture What’s new? Where are we now? Where do we need to be? How do we get there?. C-TPAT Major Focus.

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Customs - Trade Partnership Against Terrorism

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  1. Customs - Trade Partnership Against Terrorism Ted Galantowicz International Trade Compliance Manager Emerson Corporate ITC Group

  2. C-TPAT Overview • The Big Picture • What’s new? • Where are we now? • Where do we need to be? • How do we get there?

  3. C-TPAT Major Focus • The Customs-Trade Partnership Against Terrorism continues to place its major focus on • the international supply chain • truck trailers/ocean containers • from the point of ex-U.S. stuffing to the point of un-stuffing in the United States • business partners involved with international shipments • facilities, employees and procedures • high-security seals and inspection of conveyances

  4. The Big Picture • Over 10,000 certified members and continuing to grow: • U.S. Importers (over 5000) • Brokers • Carriers • Terminals • Mexican and Canadian Manufacturers • CTPAT members are increasingly requiring their business partners to be C-TPAT Certified/adhering • Congress is debating legislation on cargo security • The Green Lane Cargo Security Act (S.2008) would authorize existing regulatory approaches by giving them the force of law

  5. The Big Picture (continued) • C-TPAT Criteria and concepts have been adopted by the World Customs Organization in a “Framework of Standards” • A number of countries have agreed to adopt the Framework and support its implementation in less developed countries • The International Standards Organization has drafted ISO-28000 (Specification for Security Management Systems for the Supply Chain), and is drafting ISO 28001 (Best Practices Custody in Supply Chain Security)

  6. The Big Picture - Conclusions • C-TPAT and its Criteria are here to stay • Supply Chain Security and the C-TPAT model is being adopted by an increasing number of countries around the world • There is an increasingly strong movement to make at least some of the Criteria law and/or standard business practice in order to get expedited clearance • No longer reasonable or possible to do international business and be uninvolved with C-TPAT • It is likely that suspension or elimination from the C-TPAT program would have consequences for any company that serves as a supplier to other C-TPAT companies

  7. What’s New With C-TPAT? • There are increased ex-U.S. validation visits and soon-to-come domestic and ex-U.S. re-validation visits for older C-TPAT members • A Secure Web Portal for C-TPAT will be operational soon. All details of Emerson’s C-TPAT certification, validation, profile, will be resident and require maintenance. The site will also allow query of C-TPAT members by name. • Best Practices Catalog (going beyond the minimum criteria) • “Tier 3” – The “Green Lane” level

  8. What’s New With C-TPAT? (continued) • Increasing requirement for shipping data earlier in the supply chain cycle (beginning with the purchase order) • Heavy emphasis on procedures, inspection, control and tracking of containers/trailers • Heavy emphasis on procedures, controls, affixing, inspection, and recording of high-security seals • Increased emphasis on training and security awareness • Increased emphasis on verifications, spot checks and reviews

  9. Where Are We Now? • Emerson U.S. Division operations are C-TPAT Certified (Nov. 2003) and Validated (Jan. 2005). • U.S. Divisions have finalized/are finalizing their Supply Chain Security Policy and Procedure Manuals • U.S. Divisions have performed reviews of their domestic operations based on a corporate supplied self-assessment questionnaire • Ex-U.S. Emerson divisions have been provided supply chain security self-assessment questionnaire, but feedback on status is incomplete • Major international logistics providers have provided evidence that they are C-TPAT • Still gathering information on status of non-U.S. suppliers • Eleven Emerson Mexican plants have been C-TPAT Certified

  10. Where Do We Need To Be? – Near Term • Emerson U.S. operations involved in the international supply chain must have implemented C-TPAT Supply Chain Security minimum Criteria • Emerson related operations outside the U.S. that ship to the U.S. must have implemented C-TPAT Supply Chain Security minimum Criteria • Emerson Divisions must have obtained a form of Documentary evidence (C-TPAT Certificate, attestation, reply to questionnaire) from Logistics Partners, Brokers and Non-US Suppliers

  11. Where Do We Need To Be?– Long Term • Integration and maintenance of C-TPAT Security Criteria throughout Emerson Divisions, U.S. and non-U.S. • Verification of implementation status of Business Partners (particularly non- U.S. Suppliers) of C-TPAT Security Criteria • C-TPAT Certification of all Mexican and Canadian plants • Maintenance, spot check testing, auditing, and recordkeeping

  12. How Do We Get There? • COMMUNICATION & GUIDANCE • DIVISIONAL PREPAREDNESS • BUSINESS PARTNER REQUIREMENTS • WRITTEN POLICIES AND PROCEDURES • TRAINING • REVIEWS/AUDITS • COORDINATION AND OVERSIGHT

  13. COMMUNICATION & GUIDANCE • Continuing contacts with Division Compliance Officers and Supply Chain Security Compliance Coordinators • Continuing involvement contact with Procurement and Logistics at GBL level and division level • Revision of templates • Continued enhancement of Intranet web pages for Supply Chain Security (Emerson Corporate Intranet site, under “Emerson Resources”) • Webcasts • Eventually a Supply Chain Security Conference • Initiation of an Emerson Supplier Website

  14. COMMUNICATION: Web Pages • General overview of C-TPAT • Info on Emerson Status • Links to Customs C-TPAT site • Info on Status of Business Partners • Lists of suppliers, Logistics partners, Brokers • Links to divisional sites that have lists • Presentations on C-TPAT • Basic Overview, Supervisory/Manager and Specialized • FAQ’s • Interpretations of C-TPAT issues and information • References and C-TPAT Resources • Questionnaires, Templates, checklists • Links to MSA provisions on Supply Chain Security • Risk assessment resources • Draft Outline and references for SCS Compliance Manual

  15. DIVISIONAL PREPAREDNESS • Divisional self-assessment to be performed annually and results provided to Corporate • Preparedness status replies to be solicited annually from SCS Compliance Coordinators • Consultation visits to continue to be made to U.S. plants • Preparedness status replies to be required annually from non-U.S. Emerson entities • Mexican plants to receive added attention with regard to C-TPAT security criteria. Seek additional C-TPAT plant certification

  16. BUSINESS PARTNER REQUIREMENTS • DOCUMENTARY • C-TPAT status on logistics providers and brokers at Corporate level (91 currently on the list) • Divisions to continue to collect documentation on supply chain security status of their business partners (attestations and questionnaires) • Corporate Procurement to implement MSA provision with all suppliers • VERIFICATION • Asian Logistics program to continue training of suppliers • Procurement to carry out on-site verifications of non-U.S. suppliers • To be handled primarily by our people located in foreign locations • Possibility of doing verification through outsourcing

  17. WRITTEN POLICIES & PROCEDURES • Corporate and divisions to revise supplier agreements, using as a basis MSA Exhibit B, Provision 22 (Supply Chain Security) • Divisions to revise their Supply Chain Security Policy and Procedure manuals and ensure implementation in accord with the procedures and C-TPAT Criteria • Corporate to issue C-TPAT supplier review scorecard and scorecard instructions • Business Partners maybe required to

  18. TRAINING • Finalize & circulate outlines developed for three tiers of training: • General Overview (Awareness Training) • Managerial/Supervisory • Specialized: Procurement; Shipping & Receiving; Logistics • Corporate and divisions to offer training • At conferences • At division training sessions • Via Web presentation/conference calls, etc. • Customs training materials to be sought and provided to divisions • Outsourcing possibilities to be evaluated and recommended • Companies offering Security Training • Our current web-based training provider

  19. REVIEWS/AUDITS • Corporate Compliance Group reviews/audits • Score sheet and guidelines for scoring to be circulated and used as new basis for self evaluation • Supply Chain Security reviews at Emerson U.S. and non-U.S. Facilities to be rolled into overall Trade Compliance Audits • Business partner reviews/audits • Methodology and priority to be developed for doing business partner reviews/audits • Outsourcing possibilities to be explored and recommendations made

  20. Coordination and Oversight • INTERNATIONAL TRADE COMPLIANCE GROUP (ITCG) • C-TPAT Team: • Interdivisional and cross functional at working level • 10 members • Develop and review specific projects • INTERNATIONAL TRADE PROJECTS COORDINATING COMMITTEE (ITPCC) • High level coordination between Compliance, Logistics and Procurement • C-TPAT Business Partner Requirements

  21. Questions and Discussion

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