US customs restructures to take on e-commerce threat

Customs and Border Protection has developed an e-commerce strategy in a bid to tackle the increase in online shopping and growth of illicit and counterfeit goods shipped as small packages.

The strategy, which notes that CBP must “adapt” to the new e-commerce landscape, seeks to address emerging threats posed by the global change in commerce habits and ensure CBP has the means to enforce violations.

Under the new e-commerce strategy, CBP will, among a number of measures, look to enhance data collection and intelligence, develop and utilise state-of-the-art techniques and technologies, review its existing legal and regulatory authorities, seek to strengthen partnerships with the private sector, facilitate international trade standards for e-commerce, and educate the American public of the risks, both as consumers and as importers, associated with non-compliant products.

The crackdown and new emphasis for the CBP reflects the shift from traditional methods of importing via large, containerised shipments to small, low-value packages as direct-to-consumer business becomes more common. This has presented new inspection and data challenges for CBP, especially as the volume of these small packages has increased.

In addition, transnational criminal organisations are increasingly shipping illicit goods to the US via small packages on the belief there is a lower risk of interdiction and less severe enforcement consequences if caught. CBP said this illicit activity poses a risk to the health and safety of Americans and compromises US economic security.

The new e-commerce strategy also follows a report last month by the Government Accountability Office, which reviewed the enforcement efforts by CBP and US Immigration and Customs Enforcement in light of the increase in online shopping and sale of counterfeit goods. The report found that CBP had conducted a limited evaluation of its efforts, suggesting its activities were not the most efficient or effective, and recommended it evaluate its activities to enhance intellectual property enforcement.  

Kevin McAleenan, acting commissioner of the agency, said CBP must adapt in order to address the challenges created by the increase in e-commerce trade. “CBP remains committed to facilitating legitimate trade while ensuring consumer safety and economic vitality as the volume of e-commerce shipments continues to increase,” he said in the strategy document. “This e-commerce strategy positions CBP to properly enforce violations and address the various complexities and threats resulting from this global shift in trade to an e-commerce platform.”

The new strategy has a strong focus on data, which is one of the current limitations around enforcement of small packages. For instance, according to the strategy document, CBP will strengthen partnerships with stakeholders and encourage information sharing, proposing benefits for those parties who share advance electronic data and other information and will penalise those who are not compliant in this area.

The agency will also increase its operational efficiency and effectiveness by using data analytics, data mining, and an array of powerful analytical tools. In addition, CBP will expand its existing advance electronic data pilot in the international mail environment to include additional foreign postal operators.

To specifically address the import of illicit goods by criminal organisations, the strategy says CBP will enable data-driven enforcement in e-commerce by “implementing improved targeting solutions, strengthening interagency partnerships, and integrating data solutions to enhance current operational models and strategies” and will facilitate collaboration with federal and international partners to build capabilities with regard to data collection, analysis, targeting, and detection of noncompliant e-commerce shipments.

“As a result of enhancing existing data collection, targeting, examinations, intelligence, and international engagement, CBP will be more flexible and able to anticipate and address new risks from future business innovations in the long-term,” the strategy said.

In addition, CBP will also enhance enforcement measures to deter the importation of non-compliant goods and discourage importers. To achieve this, CBP will explore ways to incentivise and motivate the private sector to become a partner in compliance, while holding them accountable for small, low-value shipment violations. It will also look to broaden its cooperation with other agencies to enhance enforcement, alongside greater engagement with international partners.

Meanwhile, the restructuring effort will also see the implementation of new policies, procedures and staffing models such as streamlining procedures for detention, seizure, and abandonment of goods and assessing existing technologies and resource allocation.

Potential technology options include mobile applications and an e-commerce resource library, the strategy notes. CBP will also develop a portal that contains a database on importers that CBP has vetted and deemed “trusted”.

“This strategy strengthens CBP’s ability to protect the health and safety of American citizens and the US economy from non-compliant goods,” the strategy says. “By transforming CBP operations, driving compliance, and promoting cooperation domestically and internationally, the US will build a strong trade posture in e-commerce, ensuring a shared economic prosperity for the future.”