ISSUE 1 2010

NEWS

Supply chain security - a serious matter

the recent ‘10+2’ rule that requires advance information to be supplied to US Customs and Border Protection. “While I haven’t heard of too many difficulties since 10+2 was brought in at the beginning of the year, that

might be because people have learned to live with it – or simply hoping that they won’t be caught out.” The troubled 100%

container scanning rule - implementation of which has now been delayed by

two years, assuming it comes about at all - is a typical piece of US legislation, adds Andrew Traill. “It went against all advice to politicians but people were afraid of looking unpatriotic, so they went along with it.”

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The Shippers’ Voice is calling for supply chain security to be put on boardroom agendas of every major trading company. At present, this crucial issue is being handed to staff who have been given very little training or resources and who often lack the necessary managerial clout. The Shippers’ Voice has

linked up with the Cross- Border Research Association (CBRA) to produce a monthly report of supply chain security news and developments, Searchlight. It will include information on CBRA research, interviews with experts and real life stories of the fight against supply chain crime. Shippers’ Voice chairman

Andrew Traill told FBJ: “If as a shipper you get on the wrong side of authorities like customs or border control, even if it’s by accident, the long-term consequences can be serious.” If a company has transgressed in the past, even in error, its shipments may be pulled for examination more frequently, or its activity may be subjected to higher levels of scrutiny. While

anti-terrorism

measures tend to grab the headlines, agencies and governments are equally concerned with issues such as counterfeit goods, fraud and theft, he said. “The trouble is that, very

often supply chain security has been handled in an ad hoc way and often has been handed to someone who has to do it as part of their ‘main’ job. That person may not have a high status – and yet it’s something that can bring the entire company down if things go wrong.” The financial implications of even simple mistakes such as a wrongly declared tariff code can run into millions.

Also, companies often

assume, wrongly, that by outsourcing their supply chain operations, they also outsource their responsibility. Supply chain security is a

complex subject, especially as

countries impose

different rules, Andrew Traill continued. “Fundamentally, they’re all the same but there are nuances.” Rules are not consistent, even within the EU, he said. “One issue we raised concerned the new known shipper regulations for airfreight. In some countries, it’s been possible to become a known shipper simply on the basis of giving a note to your freight forwarder. Now, under the new rules, shipper status will have to be independently verified, but it’s going to take two or three years before that becomes universal. So we’ve got a two-tier system in Europe at the moment. The situation is different again in the UK, where we’ve had the system for many years.” Authorised Economic

Operator (AEO) status in the EU will bring a broadly similar approach to other modes as airfreight’s known shipper regime, but there are two strands in the AEO regime. One covers customs matters only, the other extends it to security and financial aspects of the company’s operations. “There are similarities between AEO and known shipper status, but being an AEO doesn’t automatically give you known shipper status.” There are also equivalents

to AEO outside the EU, but again there are variations. Shippers’ Voice adds that the US tends to take a radically different approach to supply chain security from other countries, as evidenced by Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36