May 30, 2014

Mr. John Pistole

Administrator

Transportation Security Administration

US Department of Homeland Security

601 S. 12th St.

Arlington, VA 20598

Dear Mr. Pistole:

The undersigned associations include among their membership many “indirect air carriers” (IACs), more commonly known as air cargo forwarders. Some of these forwarders have participated in the Air Cargo Advance Screening (ACAS) pilot. However, those participants do not represent the full scope of our membership, and the variations are significant. As requested by TSA at a meeting with Airlines for America (which was attended by some forwarder associations) in February 2014, we therefore take this opportunity to outline a broader range of issues related to ACAS and its potential impact on air cargo forwarders.

The forwarder community supports the concept of risk-based analysis at the shipment level to target air cargo transported into the United States. However, we are concerned about certain issues which we feel have not yet been fully resolved within the ACAS pilot. The majority of these concerns are TSA-related, but some are related solely to CBP, and one is related to both agencies. We recommend that the joint CBP-TSA issue be resolved prior to the issuance on the NPRM. At the same time, we wish to engage further, along with ACAS participants in the air carrier segment, with the TSA to further identify and resolve issues related to your security programs and other operational matters as they apply to ACAS.[1]

The key issue pertaining to both TSA and CBP is related to the ACAS targeting rule sets. We understand that the basic rule sets which were developed at the beginning of the ACAS pilot have remained in place, with minor adjustments, resulting in a reasonable - as identified so far - percentage of shipments being referred for additional high risk screening. However, for the past several years, we have been advised by CBP and TSA that the “Trusted Shipper” rule sets (those keyed to specific shipper volumes), would be incorporated into ACAS, replacing the “manual certifications” currently required in TSA Security Programs.

CBP and TSA have provided us with estimates, based on analytics - not actual testing - that the percentage of shipments referred for HR screening under Trusted Shipper would increase significantly. To date, we have not seen any change in referral volume, which would indicate that this has not yet been tested. Including Trusted Shipper rule sets in an ACAS rule without testing them first would not accurately reflect industry experience during the pilot, and would be commercially disruptive. We therefore believe it is essential to confirm that the Trusted Shipper rule sets will not be incorporated in the ACAS rule.

In addition, we have several ACAS-related concerns which pertain solely to TSA:

1. TSA Inbound Issues:Many of our forwarder members work closely with their carrier partners, as well as local Civil AviationAuthorities, to coordinate screening procedures for cargo bound for the United States. They are aware that not all National Cargo Security Program (NCSP) programs for passenger and all-cargo carriers allow forwarders to screen, and further that there are additional (and sometimes significant) variations in the applicability and procedures withindifferent NCSP country programs as well. Therefore, it is important to clarify what the process and verification procedures will be when an ACAS dual-filing is made at a foreign location, first by the forwarder and then by the carrier. The following questions address various potential scenarios:

a. Foreign Screening/NCSP country: TSA and CBP have stated in meetings with industry that ACAS analysis will “trump” NCSP procedures in determining risk levels of a shipment. Where foreign forwarders/regulated agents are allowed to screen under an NCSP regime, and there is a screeningprocedure for resolving “high risk” (HR)determinations in the country security program, will that be sufficient action, or will other TSA high risk protocols be required? In an NCSP country where such screening procedures do not currently exist, and the forwarder is allowed to screen cargo, how will HR procedures be communicated to the forwarder (by whom and in what format)?[2]

b.Carrier Verification: In the above instance, how will the TSA regulated party (the carrier) know/verify that the screening has in fact been completed? What messaging and records retentionrequirements will TSA establish forcompliance?

c.Amendments to TSA Security Procedures: Given the scenarios above, and assuming multiple Amendments will need to be issued to regulated parties (carriers) to account for these variations, how will instructions/regulations be provided to forwarders, since the forwarder is not regulated by TSA?

d. Forwarder Filer Not Eligible to Screen: If the forwarder files, but is not eligible to screen, (i.e., non NCSP country which enables forwarders/Regulated Agents to screen), how will the carrier be notified(i.e., what will be the message process and content required by the carrier)?

e. In -Transit Cargo: What special procedures are required for in- transit shipments, particularly for air cargo forwarders? For example, if the forwarder files in advance on a shipment from HKG-LHR-JFK, and the shipment requires additional screening at LHR, what will be required of the filer? The carrier? How will this information be communicated, to whom, and when?

2. TSA Outbound Issues:As other countries, such as those in the EU and Canada, implement their own advance data regimes, their screening requirements may not be consistent with TSA security programs outbound from the United States.

Differing Screening and Resolution Protocols: Where there are differences (such as where the shipment complies with TSA protocols but not with those of the country of destination), TSA should clarify the potential impact on U.S. export shipments. Assuming that such non-U.S. programs “trump” TSA’s security programs in the same manner that ACAS “trumps” NCSP, what will the screening requirements be for U.S. export cargo designated “high risk” by another country? For example, there are differences between the specified screening measures in the U.S. all-cargo vs. passenger security programs; recognition of these differences may not be reflected in foreign security programs. Furthermore, screening protocols can vary. Can TSA advise how it will resolve such situations, in order to avoid potentially significant extra operational and training costs for U.S. export shipments?

  1. IAC Screening: In the United States, IACs account for over 60% of cargo screened. Will IACs be able to resolve identified “high risk” shipments when instructed by a foreign customs service?
  1. “High Risk” Exports: Has an analysis been done on the potential percentage of export shipments which may be identified as “high risk” for both passenger and all-cargo carriers by foreign advance data regimes? Will TSA’s “known shipper” program be incorporated in foreign targeting analysis for shipments carried on passenger carriers?

The marketplace that serves the air cargo supply chain is highly competitive, very complex, andextremely diverse. There are over 4,000Indirect Air Carriers registered with TSA. These range in size from huge multi-national organizations with company operated offices around the world to small “mom and pops” that rely on an extensive network of independent agents at overseas airports. The size and scope of their technology infrastructure and varies widely. When constructing a workable advance-screening model, governments must take care not to disturb the competitive balance that has been achieved among these diverse players in the marketplace. Therefore, any ACAS rule should maintain the level playing field for all filers. No requirement should create an unfair competitive business advantage for one filer over another, regardless of industry segment. This is not to say that all requirements must be the same (one size need not fit all). However, a thorough review of competitive repercussions must be applied to any proposed requirements, and a range of solutions provided to meet these diverse needs and capabilities.

We greatly appreciate your attention to these aspects of the Air Cargo Advance Screening program and would welcome the opportunity to collectively discuss them in greater detail. We would be happy to host a meeting to initiate dialog on these issues, and suggest we identify a date in June for our initial session. We look forward to learning your availability in this regard.

Sincerely,

[1] We are working in parallel with CBP to address the issues specific to that agency.

[2] This presumes that in such cases the forwarder will still be allowed to screen.