TSA Certified Cargo Screening Program (CCSP)

TSA Certified Cargo Screening Program (CCSP)

Shared Services Group Supply Chain Security Supply Chain Security Track Knowledge Sharing August 25, 2009 Ken Konigsmark Senior Manager, Supply Chain & Aviation Security Compliance The Boeing Company BOEING is a trademark of Boeing Management Company. Copyright 2007 Boeing. All rights reserved. Todays Topics Shared Services Group | Security & Fire Protection | Supply Chain Security Track Charter/Members Overview: Global Supply Chain Security Activities

TSA Certified Cargo Screening Program (CCSP) Status C-TPAT Program Status Importer Security Filing (10+2) Status WCO Global Cargo Security Conference: Highlights Copyright 2007 Boeing. All rights reserved. Supply Chain Security Track Charter Shared Services Group | Security & Fire Protection | Supply Chain Security Objective: Work together to minimize risk through the development of best practices, prevention, avoidance and deterrence standards for supply chain security. Include standards as an appendix in ISO 28002. Leverage these best practices to proactively initiate consistency across industries and their related organizations/associations. Monitor and report on supply chain security initiatives and emerging requirements. Members: Inputs provided for ISO 28002:

Ken Konigsmark, Kirsten Provence- Boeing Terrence Brunson- LMI Mary Chenoweth- RAND Andrew Cox- DHS Scott Dedic- Sony Nancy Loo- MNP Consulting Bob Weronik, Sheryl Bird- GE Todd Brown-Expeditors Jim Rice MIT Amy Hamilton - Cisco Copyright 2007 Boeing. All rights reserved. - Draft text for main body para 4.4.7 - ISO Annex inputs: - Supply Chain Security Guidelines/BPs - Security Risk Assessment - Measuring Supply Chain Security

GLOBAL WCO SAFE Framework of Standards; ISO 28001/04 Mutual Recognition? INTERNATIONAL Sweden (Stairsec), EU (AEO), Canada (PIP), New Zealand (SES), Japan (Asia Gateway Initiative), BASC, Jordan, (Golden List), Singapore (Secure Trade Partnership), Australia, China, US (C-TPAT) US SAFE Port Act Congress (Pending: CBP Reauthorization, SAFE Port Acts)

9/11 Commission Act TSA -TWIC (Transportation Worker Identity Card) -CCSP (Certified Cargo Screening Program) Import Safety? CBP FAA, FDA, Commerce, etc - C-TPAT - CSI (Container Security Initiative) - FAST (Free and Secure Trade) - SFI (Secure Freight Initiative) - 10+2 Advance Data Filing - OSC (Operation Safe Commerce)

FUTURE?: US Exports? International air cargo? 100% vs. risk-based screening? Shared Services Group Supply Chain Security TSA Certified Cargo Screening Program (CCSP) Update . BOEING is a trademark of Boeing Management Company. Copyright 2007 Boeing. All rights reserved. TSA Charts from July 27th briefing to US Chamber of Commerce

100% Screening Legislation Background President Bush approved legislation Implementing Recommendations of the 9/11 Commission Act of 2007 on August 3, 2007. The legislation mandates 100% screening by August 2010 and requires TSA to: Establish a system to screen 100% of cargo transported on passenger aircraft. Provide a level of security commensurate to that of passenger baggage (piece level). No funding provided. Industry expected to bear all costs. Congressionally Mandated Cargo Screening Benchmarks 9/11 Act 50%

100% August 2007 February 2009 August 2010 6 Challenges for Industry Most wide-body cargo is tendered in skids (larger shipments). Most wide-body cargo flows through freight forwarders (consolidators). Freight forwarders typically containerize/palletize cargo prior to

tendering to airlines. If airlines only must screen all cargo, they anticipate significant delays, increased processing/cut-off times, costs. Airlines lack space/facilities to de-palletize, screen, and re-configure these shipments. Potential exists for damage to packaging/goods. 7 TSA Approach to Assist Industry in Attaining Screening Mandates Certified Cargo Screening Program created to: Allow screening of cargo early in the air cargo supply chain by a trusted, vetted, and audited facility. Initiate and maintain the integrity of a shipment throughout the supply chain by utilizing stringent chain of custody methods.

Enable entities such as shippers to incorporate physical screening into packing process. Participation in CCSP is voluntary, but requires participant to: Implement and adhere to facility security standards and access controls. Train employees and authorized representatives on CCSP and security responsibilities. Get Security Threat Assessments (STAs) for employees involved in screening. Screen cargo in accordance with TSA screening standards and processes. Initiate and maintain chain of custody on all screened cargo. Permit onsite facility assessments by TSA-Approved Validation firm or PCSA. Adhere to all program requirements, subject to TSA inspections, after certification. 8 CCSP Applications Received/Certifications thru July, 2009 Applications received as of July 2009: 1,138+ CCSF applications have been received. Certifications as of July 27, 2009:

410 facilities have been certified (80% are freight forwarders). Application momentum has fallen off since 50% attained: From existing applicants. Few new applicants. 9 Reaching 50% (Feb 1, 2009) 50% milestone was seemingly easy for shipping community, but: Economic downturn caused over 35% drop in volume of cargo. Airlines invested significantly in additional technology (primarily ETD). CCSF (Certified) Freight Forwarders handled some cargo screening on behalf of shippers (a new program). TSA provided Air Carriers and IACs with flexibility when determining what to screen at 50%. - Narrow body shipments helped the equation. Certain commodities were excluded for a limited time frame (until August 31st, 2009).

10 Industry Challenges for 100% (Aug 1, 2010) 11 Industry Issues Through extensive interaction with Industry, we have gained insight into some key issues specific to various industries: Hi Tech: Some products are sensitive to static discharge. Perishables: Delay in screening may damage or spoil goods. Goods may also require refrigeration. Pharmaceuticals: Many products must be kept refrigerated. Others are FDA sealed and cannot be opened without damaging content. Museums & Galleries: Fine art is fragile, priceless, and unique; requiring very specific screening processes and procedures.

Most shippers do not want to risk the possibility of having their shipments opened for physical resolution of any false alarm issues (contamination). 12 TSA Concerns toward 100% Waning CCSF application flow from shipper community. Perception that reaching 50% was easy, thus a similar result at 100%. The hardest part still lies ahead. Difficult, complex cargo remains. Most of the shipments screened today are not skidded. Airport/airline space limitations inhibit ability to break apart, screen, re-skid, etc. Time constraints carriers indicate they will require significantly earlier cutoff times. Risk of delay or damage. Economic recovery leading to increase in cargo volume. Screening 100% of 15 million lbs in 2010 vs. 50% of only 9 million lbs in February

2009. This represents a 300% +/- increase in the amount of cargo to be screened!! Commodities with unique screening needs. Insufficient availability of technology to meet industry demand (backlogs). High risk of physical inspection due to potential contamination in transit to carriers. Maintain integrity of shipper skids. 13 Summary 50% was reached thanks to the hard work of Air Carriers and existing CCSFs Freight Forwarders. Reaching 100% requires larger community effort to overcome industry challenges and TSA concerns. CCSP is the solution for industry to meet the 100% screening mandate, and fully supported by the air freight and air carrier industries. Only CCSF shippers can ensure the integrity of their shipments. Most shippers can readily incorporate physical search into packing/shipping process without investing in equipment.

TSA is providing an incentive for shippers to join CCSP. The alternative only cargo that is fully screened will be uplifted on August 1, 2010. 14 Boeing CCSP Certification Experience Shared Services Group | Security & Fire Protection | Supply Chain Security Los Angeles Distribution Center applied for CCSF status Efforts to date: Extensive research/program development Training Employee STA background checks Facility security improvements (interior cage, access controls) Procedural changes Documentation/evidence Certification assessment conducted July 30th Be able to prove everything!

SAFETY Act coverage pending Copyright 2007 Boeing. All rights reserved. Shared Services Group Supply Chain Security CBP Notices/C-TPAT (Customs-Trade Partnership Against Terrorism) . BOEING is a trademark of Boeing Management Company. Copyright 2007 Boeing. All rights reserved. Container Inspection Instructional Video Shared Services Group | Security & Fire Protection | Supply Chain Security

This year CBP video taped the 2009 Training Seminar Container Inspection Presentation. We are pleased to provide the video for your review and to be used as training for your employees. By opening the below listed link, you will be able to save the video to your computer for your later use. https://ctpat.cbp.dhs.gov/images/videos/Container%20Inspection.wmv Copyright 2007 Boeing. All rights reserved. CBP C-TPAT Security Bulletin: SW Border Shared Services Group | Security & Fire Protection | Supply Chain Security Several large narcotics seizures involving commercial shipments linked to CTPAT members. Narcotics were co-mingled with commercial goods. C-TPAT members were utilizing the services of non-C-TPAT service providers. Members are expected to use C-TPAT partners to the extent possible and to conduct extensive screening of their non-C-TPAT business partners. Members must have written and verifiable processes in place to ensure screening takes place on a consistent basis.

Reviews of recent events have identified two primary causative factors: Companies had established security procedures yet failed to follow them. Lack of corporate oversight resulted in significant levels of subversion of established supply chain security procedures via internal conspiracies. Copyright 2007 Boeing. All rights reserved. Bulletin, cont Shared Services Group | Security & Fire Protection | Supply Chain Security C-TPAT partners must perform internal risk assessments to identify inherent threats to supply chain corridors and augment established security procedures accordingly: Ensure there is adequate oversight and accountability of the cargo loading and sealing process. Employ cameras and/or other monitoring devices or processes at cargo loading areas. Ensure that all conveyance hardware and fastening devices are inspected for overall security and deterrence of unauthorized access. Consider the use of more stringent security devices to secure trailer doors. Audit and verification of employee screening processes, to include periodic reviews.

Consider rotating personnel assigned to operationally sensitive positions, such as dispatcher. Review the established processes for oversight of the transportation component. Members should work with service providers to develop written and verifiable procedures to track conveyances from the point of origin to the final destination. Establishment of route times from the manufacturing site to various points in the transportation flow will help monitor and ensure that drivers are arriving at designated locations within established timeframes Members should work with service providers to develop procedures for instances when a driver does not check in within established timeframes. Drivers should not be allowed to make unauthorized stops. Copyright 2007 Boeing. All rights reserved.

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