1st Edition

Managing Global Supply Chains Compliance, Security, and Dealing with Terrorism

By Thomas A. Cook Copyright 2008
    320 Pages 78 B/W Illustrations
    by Auerbach Publications

    September 11, 2001 had a profound impact upon individuals, institutions, and governments, but also upon the world of global trade. Years later, the reverberations of this deliberate and focused act of terrorism are manifest in much more stringent logistics, documentary requirements, and regulations. A single source on compliance and security, written from a supply chain manager’s perspective, Managing Global Supply Chains sorts out all the issues and frames a comprehensive strategy for supply chain executives in the post 9/11 world.

    The Events of 9/11 and How They Affect Global Supply Chains
    Overview of Issues and Concerns
    9/11: How Were Supply Lines Affected?
    It Costs More to Ship
    More Attention Had to Be Paid to Documentation and Logistics Detail
    Regulations Changed, Making It More Cumbersome to Import and Export
    Corporations Had to Modify Their Supply Lines
    Purchasing and Selling Decisions Were Altered
    Carriers’ Futures Were Uncertain
    Increase in Potential Fines and Penalties
    An Entirely New Corporate Responsibility Was Created in Security and Compliance
    The Mind-Set of the United States Government
    The Big Picture
    The Risks of Global Trade: Now, Add Compliance and Security
    The Security Concern in Our Transportation Infrastructure
    Operation Safe Commerce (OSC)
    Free and Secure Trade (FAST)
    What Is the FAST program?
    What Are the Benefits of the FAST Program?
    Who Is Eligible to Apply?
    Where Is FAST Available?
    Compliance and Security: Import Supply Chains
    Protecting our Borders Against Terrorism
    CBP’s “Twin Goals”: Anti-Terrorism and Facilitating Legitimate Trade and Travel
    Better Targeting
    Pushing Our “Zone of Security” Outward
    Partnering with Other Countries
    Partnering with the Private Sector (C-TPAT)
    Inspection Technology and Equipment
    Keeping Weapons and Money from Falling into Terrorist Hands: Outbound Inspections
    Protecting the Miles of Open Border Between Official Ports of Entry
    Basic Import Management
    Origin Markings
    Record Keeping
    Customs Brokers
    Records Storage Methods
    Customs Initiatives Since 9/11
    Highlights of CBP’s Accomplishments
    Strengthening Our Control of U.S. Borders
    Improving Selectivity, Screening, and Targeting
    Private, Public Sector, and International Partnerships
    Importer Self Assessment (ISA)
    Food and Drug Administration (FDA) (Imports)
    New (Interim) Final Rules Require Registration of Facilities, Prior Notice Filing for Food Shipments
    Automated Commercial Environment (ACE)
    Managing Inbound Supply Chains: Purchasing Control
    Export Supply Chains
    Department of Commerce Census Bureau
    Department of Commerce Bureau of Industry and Security
    Export Licensing
    Denied Parties Screening
    Deemed Exports
    Anti-Boycott Compliance
    Department of Treasury Office of Foreign Asset Controls
    Department of State
    Implementing a Successful Export Compliance Program
    Designating Responsibility
    Senior Management Support
    Developing Standard Operating Procedures
    Best Practices
    Internal Assessment
    Developing a Compliance and Security Management Program
    Analysis of Risks
    Obtaining Senior Management Involvement
    Forming a Committee Structure
    Creating Standard Operating Procedures
    Infrastructure and Communication Systems
    Resource Development
    Risk Management Attitude
    Disaster and Contingency Planning
    Managing Vendors, Suppliers, Freight Forwarders, Customhouse Brokers, and Service Providers for Compliance and Security Issues
    Overview of Global Service Providers
    Customhouse Brokers and Freight Forwarders
    Specific Compliance and Security Reference Points for Forwarders and Brokers
    Carriers: Air, Ocean, Truck, and Rail
    Warehouses and Consolidation/De-Consolidation Facilities
    Selling Distributors and Agents in Export
    Purchasing Distributors and Agents in Import
    Third-Party Providers
    Banks and Other Finance Houses
    Miscellaneous Companies and Services
    Cost-Effective Logistics
    Critical Issues in Compliance and Security
    Sarbanes–Oxley and the Interface with Global Supply Chain Management
    DOT Hazardous Material Regulations (49 CFR 100-179)
    Shipping Papers
    Marking and Labeling
    Segregation of Hazardous Materials
    Selection of Proper Packaging
    Employee Training
    Materials of Trade
    Managing Hazardous Materials Transportation as Part of Compliance in Global Supply Chains
    Facility Security Checklist
    Security Checklist for Shipper
    Carrier Safety Assessment
    Employee Background Check Guidelines
    International Port Security Program
    The SAFE Port Act
    Technology Issues In Compliance and Security
    Department of Homeland Security (DHS): “Best Practices for
    Container Seals”
    Plan to Require Container Seals Motivates Adoption of 13 Cargo Security Best Practices
    Standards and Deadline to Come
    Getting Ahead of the Curve
    Best Practices Outlined
    Radio Frequency Identification (RFID): Smart and Secure
    SST Phase I Results
    SST Phase II Objectives
    SST Phase II Benefits
    SST Phase II Deliverables
    Required Shipper’s Resources
    Supply Chain Benefits
    Foreign Corrupt Practices Act
    Food and Drug Administration/Environmental Protection Agency
    Propose Security Restrictions
    Food and Drug Administration
    Environmental Protection Agency
    Ultimate Consignee
    INCO Terms
    Use of the Term “Ex Works” by Parties in International Contracts and Purchase Agreements
    Routed Export Transactions under the July 10, 2000, Federal Register Notice
    Responsibilities of Parties in a Routed Export Transaction
    Record Keeping: A Vital Issue
    Transfer Pricing: A Serious and Potentially Costly Compliance Issue
    IRS, CBP, SEC, and DOJ Involvement?
    What Business Travelers Need to Know
    Container Security Update 2007
    Customs-Trade Partnership Against Terrorism
    Security Requirements for Validation of Participants
    Business Partner Requirements
    Security Procedures
    Security Training and Threat Awareness
    Information and Technology Security
    CBP Proposal for Advance Trade Data Elements
    Security Filing: Proposed Data Requirements
    Vessel Stow Plan: Container Status Messages
    Security Filing: Responsible Parties
    Annex A: Proposed Data Definitions
    Annex B: Data Elements Comparison
    Customs Bonds
    Parties to a Bond
    Types of Bonds
    Amounts of Bonds
    Continuous Bond
    Breach of Bond
    Ten Steps to a Secure and Compliant Supply Chain
    Acknowledge the Issues
    Identify the Point Person
    Obtain Senior Management Authorization
    Develop an Initial Execution Strategy
    Obtain External Resources and Support
    Develop a Compliance and Security Committee
    Complete a Facilities Review
    Prioritize the Issues. Finalize an Action Plan. Implement the Program
    Training and Education
    Concluding Remarks
    The Challenges of Compliance and Security in our Global Supply
    Legislation Related to the Attack of September 11, 2001
    Bills and Joint Resolutions Signed into Law
    Other Resolutions Approved
    Legislation with Floor Action
    New Government Cargo Security Rules Call on Forwarders to Work with Agents on Securing the Supply Chain
    General Aviation Security: Increased Federal Oversight Is
    Needed, but Continued Partnership with the Private Sector Is
    Critical to Long-Term Success, GAO-05-144, November 10, 2004
    Key Acronyms


    Thomas A. Cook