Supply Chain Expertise and Technology Blog by TMC, a division of C.H. Robinson

Global Logistics and Trade Programs: An Update on GSP and C-TPAT

global-trade-agreementsUpdates and adjustments to global trade programs have been capturing headlines and creating uncertainty for several months. Even with NAFTA negotiations moving into 2018, there are still other possible global trade updates on the horizon that shippers should keep an eye on. Here’s a brief check-in on two important global trade programs that are on the cusp of potential change.

Will GSP lapse?

Generalized System of Preferences (GSP)—the largest and oldest U.S. trade preference program—was established by the Trade Act of 1974 to promote economic development by eliminating duties on thousands of products imported from one of the 129 designated beneficiary countries and territories, including India, Thailand, and Indonesia.

GSP will expire at the end of this year. And while Congress recognizes the importance of passing GSP in a timely manner, there has not been any movement yet. GSP has lapsed in the past, which led to importers having to pay duties on goods that had previously been duty-free. When GSP was reinstated, it was done so retroactively, with refunds issued by U.S. Customs and Border Protection (CBP) on the duties importers paid when GSP was inactive. If and when GSP is renewed again, it’ll likely be packaged with the Miscellaneous Tariff Bill (MTB); it remains to be seen whether it will be retroactively renewed.

What’s happening with the C-TPAT reauthorization?
Customs Trade Partnership Against Terrorism (C-TPAT) is a program in CBP’s multi-layered cargo enforcement strategy to strengthen international supply chains and improve U.S. border security.

At present, the program is still in the process of updating the Minimum Security Criteria (MSC), which outlines the security requirements a company must meet to be eligible for the program. The changes and updates are being made to ensure that C-TPAT participants receive tangible benefits for their partnership with CBP. It’s likely that you can expect more stringent requirements around emerging threat areas like IT and cyber security. These updates are not surprising, given the hacking events and data breaches in recent years, and will aim to address and close cyber security gaps.

We’ll share updates here on Connect as we continue to monitor the progress and changes made on these and other global trade programs.

 

- Ben Bidwell, Director of U.S. Customs, C.H. Robinson

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