U.S. importers that are members of the Customs-Trade Partnership against Terrorism (C-TPAT), when serving as U.S. exporters of goods to the European Union (EU), will receive expedited Custom clearance, decreased inspection frequency, and other benefits when they export to European ports. Similarly, companies that have Authorized Economic Operator (AEO) status in the EU will be treated like C-TPAT members when they import into the United States. This represents full implementation of the May 2012 mutual recognition agreement between Customs and Border Protection (CBP) and the EU Taxation and Customs Union Directorate.
In order to take advantage of the benefits of mutual recognition, U.S. importers must be Tier 1 or Tier 2 C-TPAT members, meaning that the adequacy of their security measures and their requirements for business partners must have been “validated” following inspection by CBP. Similarly, EU AEOs must be AEOSs or AEOFs, meaning that they have been validated following examination and inspection by the national authorities of an EU member state as compliant with the safety and security component (as opposed to just the Customs simplifications component) of the AEO program.
The primary benefits available to importers will be lower automated risk assessment scores given reciprocally to members of C-TPAT and EU AEOs. This has the very real advantage of dramatically decreasing inspection frequency for member company’s shipments on both sides of the Atlantic, and member companies’ shipments that are selected for inspection are given priority over nonmembers’ shipments. For those companies that would have become C-TPAT members and EU AEOs absent mutual recognition, the primary benefit is the elimination of the requirement of repeat examinations/audits by both U.S. and EU member state officials of the same aspects of their operations before the companies can benefit from trusted treatment by U.S. and European authorities. The U.S. and the EU have similar mutual recognition agreements with other countries and are in the process of negotiating new ones. This significantly increases the incentive to make the initial investment of time and money and get certified and validated under C-TPAT and/or another jurisdiction’s similar program.
We have covered the Customs-Trade Partnership against Terrorism (“C-TPAT”), a U.S. Customs and Border Protection program that entitles importers who have proven their compliance with its requirements to less frequent security inspections of their goods, before on this blog.