Assignment
Freight companies pay for security threat
- November 2001 Customs Trade Partnership against Terrorism (C-TPAT). Carriers, customer's brokers, freight forwarders or importers joining the programmer must conduct a thorough self-assessment, tighten their supply-chain security and be subject to regular reassessments. While C-TPAT is a voluntary programmer, companies not in it are more likely to have their cargo delayed by inspections. Companies must be C-TPAT compliant before they can join other initiatives, such as Fast (see below) or the importer Self-Assessment programmer...
- January 2002 Container Security Initiative (CSI). Through the CSI, US customs officers are being deployed in foreign ports. The idea is to engage ports - and their countries' governments - that send the highest volumes of container traffic to the US to help identify and inspect high-risk containers before they reach the states.
- September 2002 Free and Secure Trade (FAST). Carriers and importers that have enrolled in C-TPAT - and whose drivers are rigorously vetted and drive trucks fitted with special transponders - receive faster customs clearance through this programmed. The programmed also reduces the information required by US Customs and creates dedicated lanes at border crossings for Fast participants.
- November 2002 Operation Safe Commerce (OSC). A public private partnership OSC tests new procedures and technologies to enhance the security of container shipments. Tests are being carried out at three transport hubs: the Port Authority of New York and New Jersey, the Ports of Seattle and Tacoma and the Ports of Los Angeles and Long Beach.
- December 2002 24 Hour Rule. Carriers must file a detailed manifest electronically or by paper with US Customs 24 hours before a US-bound container is loaded on to a vessel in a foreign port. Rules for other transport modes have followed, requiring manifests to be submitted an hour before trucks arrive in the US (30 minutes for FAST trucks), two hours for rail carriers and four hours for air carriers.
- December 2003 Bio-Terrorism. Launched by the US Food and Drug Administration, it requires those shipping food products for consumption by humans or animals to the US to give inspectors advance notice before shipments arrive. The FDA and US Customs have agreed to share information so companies will not need to submit details twice about incoming shipments.
- July 2004 International Ship and Port Facility Security Code. Drawn up by the International Maritime Organization, it contains mandatory regulations for all port facilities receiving vessels of more than 500 gross tones on international routes.
Question
1 What types of costs are being imposed on the freight industry by such legislation?
2 Consider the impacts of these additional costs on the freight industry and the economy as a whole.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.