Industry Representatives Tell CBP There's Too Little Transparency in E-Commerce Environment
Several industry representatives voiced frustrations about e-commerce’s impact on U.S. importers at a March 1 CBP meeting (see 1902110020), calling for a more streamlined filing system and a crackdown on foreign sellers. A common complaint by the industry leaders was a lack of transparency from foreign companies when they sell through online marketplaces. The public meeting, titled “The 21st Century Customs Framework,” featured multiple panels of industry representatives offering suggestions and criticisms of the current customs system to government officials from CBP, the Commerce Department and the International Trade Commission, among others.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
The foreign e-commerce sellers bypass U.S. safety and testing regulations, said Rebecca Mond, vice president-federal government affairs for the Toy Association, and disproportionately place the “burden of enforcement” on the brand owners of the items. That leads to lapses in enforcement, said Mond, who spoke on the "Intelligent Enforcement" panel. “It’s like playing some twisted game of find the needle in a haystack and whack-a-mole all at the same time,” she said
Among the solutions proposed by industry leaders were improvements to manifest papers and more communication from customs officials. Marianne Rowden, president and CEO of the American Association of Exporters and Importers, echoed previous comments sent to CBP Feb. 4 in which she summarized a plan for a “Mod Act 2”: reforms of the magnitude of the Customs Informed Compliance and Modernization Act of 1993 (see 1902140022). “The centerpiece of the proposal is to streamline importers’ financial accounting procedures to a 21st century business environment,” said Rowden, who spoke during a panel on "21st Century Trade Processes."
Cornelia Steinert, senior manager-international trade at Canon Virginia, said there is “simply no visibility” for importers of e-commerce products, especially small shipments. “How do you know what they’re ordering?” she said. “A lot of times you can’t tell where the products are being shipped from.” She called for improvements to CBP manifest filings, saying they should include the “country of origin and at least a six-digit Harmonized Tariff [Schedule] classification.”
Matt Priest, president and CEO of the Footwear Distributors and Retailers of America, said one of the footwear industry’s biggest issues is “unauthorized third-party sellers” online. Priest suggested more communication between CBP and the industry to ensure the industry remains in compliance. “The prevalence of e-commerce has just been so difficult for our members to get their hands around when it comes to enforcement, information sharing and whatever repercussions are available to them,” Priest said.
Another problem is the multiple filings made to CBP and each foreign government agency involved in selling a product online, said Cindy Allen, vice president-regulatory affairs and compliance for the FedEx Trade Network. She said the many filings “limit the visibility for each authority to truly understand the risk,” and she called for more cooperation between CBP and foreign customs agencies to limit filings.
“All of this information is extremely segmented right now. No one party has all of the information,” Allen said. “It becomes important that CBP have the authority to collect the information about the shipments from all parties ... to perform effective risk management and intelligent enforcement and then be able to link all of the segments.”