Customs Releases Guidelines and FAQ for C-TPAT Validation Process

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August 14, 2003

Customs has posted on its web site (www.customs.gov) guidelines and frequently asked questions (FAQ) concerning its Customs-Trade Partnership Against Terrorism (C-TPAT) validation process. According to Customs, a C-TPAT validation is a process through which Customs meets with company representatives and potentially visits selected domestic and foreign sites to verify that the supply chain security measures contained in the C-TPAT participant's security profile are accurate and are being followed.

Validations will focus on material in the participant's C-TPAT security profile and any related materials provided by the participant.

Customs plans to conduct these validations under the guiding principles of C-TPAT.

Customs states that the principal goal of a validation is to ensure that the supply chain security measures contained in the C-TPAT participant's security profile are reliable, accurate and effective. However, Customs expects that validations will also provide a forum through which Customs and C-TPAT participants can build stronger partnerships by discussing supply chain security issues, sharing "best practices," and cooperatively developing solutions to address potential vulnerabilities.

It has been reported that Customs has recently begun its C-TPAT validation process with 15 importer volunteers. According to Customs, some of these validations have been completed. All 15 of the validations are expected to be completed by April 1, 2003. Sources have previously stated that after this first round of validations has been completed, Customs plans to review and evaluate the validation process and make any changes before beginning a new round of validations. Customs has stated that it plans on validating the security profiles of all C-TPAT participants within three years of the company becoming a certified member of C-TPAT.

The order in which a C-TPAT participant's profile will be selected for validation will be based on risk management principles and may be initiated on import volume, security related anomalies, strategic threat posed by geographic regions, or other risk related information. Alternatively, Customs states that a validation may be performed as a matter of routine program oversight. Customs notes that the field offices will not initiate validations and unannounced validations will not be conducted. C-TPAT participants will be given thirty days advance written notice along with a request for any supporting documentation that is needed.

According to Customs, a Partnership Validation Team, (PVT), consisting of Customs' Office of Field Operations personnel and a representative of the C-TPAT participant, will conduct the on-site validation. Customs representatives on a PVT will be officers knowledgeable in supply chain security matters. Each validation will be customized for the participant involved and focused on the company's C-TPAT security profile. Prior to the on-site validation, the Customs representatives on the PVT will review the participant's security profile, any supplemental information received from the company, and any Customs Headquarters instructions, to determine the extent and focus of the validation.

At the beginning of the validation, the PVT will meet with company officials to discuss the process. Upon completion of the validation, the PVT will again meet with company officials to discuss the validation findings. Customs notes that a validation is not an audit and does not measure a company's adherence to existing government rules and regulations. Rather, a validation is focused on the reliability of the materials that a company voluntarily submits to Customs under the C-TPAT program. Validations will be focused and concise. Although they may extend beyond two weeks on some occasions due to Customs planning and travel, they will not involve more than ten (10) days of a company's time.

In preparation for the on-site validation, the PVT will also consider pertinent C-TPAT security recommendations. According to Customs, these recommendations (which are available at attachments to Customs' C-TPAT validation guidelines at www.customs.gov/xp/cgov/import/commercial_enforcement/ctpat) are a reference tool for considering the sufficiency of specific aspects of a participant's C-TPAT security profile. These security recommendations are not mandatory and are not all-inclusive with respect to effective security practices.

According to Customs, validation findings will be documented, included in the PVT's final report, and forwarded to the Director of C-TPAT for final editing and sharing with the C-TPAT participant. Ideally, Customs hopes that these reports will affirm or increase the level of benefits provided to the participant; however, depending on the findings, some or all of the participant's C-TPAT benefits may be deferred until corrective action is taken to address identified vulnerabilities.