Testimony of
Peter H. Powell, Sr.
Senior Counselor
National Customs Brokers and Forwarders
Association of
On May 20, 2008
before the
House Committee on Foreign Affairs
Subcommittee on Terrorism, Nonproliferation,
and Trade
Mr. Chairman, I am Peter
H. Powell, Sr., Senior Counselor to the National Customs Brokers and Forwarders
Association of
NCBFAA is pleased to offer
its support to H.R. 5828, sponsored by Representatives Don Manzullo and Adam
Smith. The legislation, we believe,
strikes the correct balance between improving the enforcement of our nation’s
export control laws and facilitating the ability of the private sector to
export their product overseas. H.R. 5828
is also clearly cognizant of the differences between small, medium and large exporters,
a factor very compelling to NCBFAA, an organization that prides itself on
representing the interests of small business. We believe that H.R.5828 will greatly enhance
our interaction with agencies involved in the export process, as well as
advancing the interests of our exporting clients.
First, allow me to tell
the committee about NCBFAA. We are
comprised of over 800 individual companies, from throughout the
The primary means for
reporting export shipments to the government has been the Shipper’s Export
Declaration, which is now available to filers in an automated mode, the
Automated Export System (AES). Through
this electronic pipeline, data is directed to Census, BIS, State, Defense,
OFAC, and other regulatory agencies with jurisdiction over exports. Ultimately, direction is provided to CBP,
which acts as the federal enforcement agency at
In the near future, AES
will be integrated into CBP’s soon-to-be-completed Automated Commercial
Environment (ACE) and connect to the agencies of jurisdiction through the
International Trade Data System (ITDS).
Thus, by filing electronically through a single window, export data will be routed simultaneously to all
relevant agencies for approval and oversight, while on-the-ground enforcement
instructions will subsequently be issued to Customs at the port. The opportunity for better, more accurate
enforcement and disposition of cargo makes AES an invaluable tool to both the
government and exporter alike. But, it
becomes all the more critical that the information going into AES is accurate,
reliable and timely.
H.R. 5828 is an important
step in meeting these objectives. The
legislation establishes the Automated Export System as the primary instrument
for inputting Shipper’s Export Declaration data and delivering that information
to the appropriate federal agency.
Importantly, it changes a
paradigm. Presently, when information is
keyed into AES, the system will accept any information filed at face
value. It is then the responsibility of
federal enforcement personnel to identify prohibited or restricted exports as
they flow through our ports. As trade
increases dramatically, particularly now during an unprecedented high water
mark for exports, the task of intercepting 100% of the goods that violate
export control or trade sanctions becomes impossible.
H.R. 5828 requires AES to
use the power of automation to assist in this task by refusing to process
illegal exports. The bill requires
federal agencies to incorporate laws and regulations into AES that will alert
the exporter about licensing requirements and deny processing where restricted
parties or countries subject to trade sanctions or embargo are involved. This will be an important compliance tool for
an exporter making an inadvertent or honest mistake. It means that the filer, most often our
member, will have the necessary additional resources to process export
applications with greater confidence that they meet the letter of the law.
The legislation also
provides assurance to the government that the filers of AES data have the
requisite skills, knowledge and professionalism to merit this trust, by
requiring filers to be licensed.
Candidly, it may seem unusual for a professional association to embrace
licensure for its members. This position
becomes more plausible in light of our years of experience working with the
Bureau of the Census. NCBFAA has worked
harmoniously in developing the AES system and providing education benefits to
our members.
Under the bill, Census
will accelerate its efforts to educate filers and provide tutelage for those
processing lawful exports. Furthermore,
the licensure provisions are not unduly burdensome:
Ø
each company
must have a licensed individual responsible for supervision and control of
those employees who file SED data with AES;
Ø
loss of a
license is protected by reasonable due process procedures;
Ø
and, acquisition of a license by a
Our Education Foundation
will develop the curriculum to educate our members in order to qualify for a
license and then to meet Census’ continuing education requirements. For those who are not members of our association,
Census has authority under the bill to conduct similar such training for those
seeking a license. In sum, Mr. Chairman,
we are confident in the ability of professional freight forwarders to respond
to this responsibility.
The National Customs
Brokers and Forwarders Association of America support H.R. 5828 and thank the
subcommittee for so expeditiously holding this hearing. We also congratulate Congressman Don Manzullo
and Congressman Adam Smith for authoring a bill that will greatly advance the
nation’s export control system. The bill
employs the power of automation both to improve enforcement and to make those
requirements easier to negotiate for the exporting public. We thank you for this opportunity to speak on
the bill’s behalf.
House Rule XI Disclosure
Pursuant to House Rule XI, clause 2(g)(4), the
Subcommittee is hereby informed that the National Customs Brokers and
Forwarders Association of America has received no federal grant, contract, or
subcontract in the current and preceding two fiscal years.