ATLANTA -- A “proof of concept” set to begin in September will provide for brainstorming and early-stage testing on the use of blockchain technology in processes related to NAFTA and the Central America Free Trade Agreement (CAFTA), Vincent Annunziato, director of CBP’s Business Transformation and Innovation Division, told a group of reporters at the CBP 2018 Trade Symposium on Aug. 14. CBP will consider not only the technical capabilities of blockchain and any business benefits but also whether use of the technology fits with the agency’s regulatory and policy scheme.
ATLANTA -- CBP is focused on the related goals of deploying new technologies and catching up with the massive growth in e-commerce as it moves toward the end of the decade, CBP Commissioner Kevin McAleenan said in opening remarks at the agency’s 2018 Trade Symposium Aug. 14. Beyond helping CBP confront the “seismic shift” in the supply chain over the past several years, new technologies will soon also smooth trade across land borders and improve the agency’s targeting efforts, McAleenan said.
CBP posted updated Customs-Trade Partnership Against Terrorism Minimum Security Criteria to the CTPAT portal and is seeking comments from CTPAT members, CBP said in a document posted ahead of the Aug. 1 Commercial Customs Operations Advisory Committee (COAC) meeting. "In late July, CTPAT Members received an email from the program outlining the key elements of the socialization strategy -- including the development of Workbooks for each of the entities eligible for CTPAT membership which have been uploaded to the CTPAT Portal; the delivery of live webinars; and an agenda outlining a series of workshops that are being delivered throughout the United States by CTPAT field personnel," CBP said.
The World Customs Organization issued the following release on commercial trade and related matters:
The European Union's General Data Protection Regulation (GDPR) may limit the applications of blockchain within international trade, the Venable law firm said in an alert. "One unintended consequence of the GDPR, which became enforceable on May 25, is that it creates serious legal uncertainties for companies that are developing and/or considering whether to implement potential blockchain applications for the supply chain," it said. Because GDPR limits the use of personal data records and blockchain technology is inherently difficult to alter, the regulations raise "numerous legal questions regarding the possible use of blockchain for supply chain applications," Venable said. " For example, using blockchain to transmit bills of lading would help prevent fraudulent transactions; however, a bill of lading may contain personal data." There may be "opportunities to make the case to EU authorities that additional clarity and flexibility is needed to 'future proof' the GDPR so as to allow for the use of blockchain and other new technologies that have the potential to yield immense benefits to global supply chains and enhance global economic growth," the law firm said.
The European Union is budgeting for major improvements to its customs system between 2021 and 2027, the European Commission said in a June 8 news release. The EC said it will budget about $1.1 billion in customs improvements for the six-year span, up from $616 million from 2014-2020, it said in a fact sheet. "The new customs budget will help customs administrations to deal with increasing trade flows and emerging trends and technologies, such as e-commerce and blockchain," it said. The EU collected about $23.9 billion in customs duties on imports during 2017, it said.
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CBP will launch a two-to-four-week pilot program of blockchain technology this fall related to NAFTA and Central America Free Trade Agreement certificate of origin processes, a CBP spokesman said. NAFTA and CAFTA origin procedures were chosen for the pilot because it's an instance where CBP needs to reach further back into the supply chain than just the exporter and can "message multiple partners via blockchain at the same time." It was also appealing because it has a small, defined scope with potential for reducing paper processes, he said.
Industry and government witnesses told Congress that using blockchain markers could help make shipping more efficient and make fraud more difficult. But the lack of an international standard so far makes implementing a system difficult, they told members conducting a joint hearing on the technology's use in international trade.
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