Date: Friday, August 15, 2008 Re:  Container Seal Requirements Dear NASA Member: Received the below General Notice from the U.S. Customs & Border Protection (CBP) regarding container seal requirements. Please note that JF Hillebrand, as a member of C-TPAT, complies with the below and any seals supplied by JF Hillebrand will meet the minimum security requirements as outlined below: Effective October 15, 2008 under a mandate of The US SAFE Port Act (Section 204(a)), and the 9/11 Commission Act of 2007, ISO PAS 17712 container seals will be required on all loaded containers arriving the US, and must also be on all containers destined to foreign destinations via US ports whether discharged or not at US ports. Effective October 15, 2008 CBP will begin vigorous enforcement. It is not yet clear who CBP will hold accountable, the carrier, vessel operator, or the importer. Such action may also have an effect on terminal fluidity should CBP decide on physical mitigation. For C-TPAT members the ISO PAS 17712 seal must be of the "High Security" type and will be identified per the ISO PAS 17712 standard. 4.2 Marking 4.2.1 Seals shall be identified by unique marks (such as a logotype) and unique numbers that are readily legible; markings intended for unique identification of the seal shall be considered permanent. All seals shall be uniquely numbered and identified. 4.2.2 Qualifying seals shall be marked or stamped in a readily legible way to identify their classification as indicative ("I"), security ("S"), or high-security ("H") seals. In order to be qualifying, the seal must (a) meet the appropriate physical parameters in this International Standard and (b) be manufactured by a firm that is verifiably compliant with Annex A. Any modification of markings shall require obvious irreversible physical, chemical, heat or other damage to or destruction of the seal. Please examine your processes and remind all of your suppliers of this obligation in time to avoid penalties for loads arriving the US after October 15, 2008. The following memo was issued by the World Shipping Council which gives further information regarding this legislation: As most reported in our March 2008 Issues Update, The SAFE Port Act (Section 204(a)) provides: "effective not later than October 15, 2008, all containers in transit to the United States shall be required to meet the requirements of International Organization for Standardization Publicly Available Specification 17712 standard for sealing containers....". That provision was amended by The Implementing Recommendations of the 9/11 Commission Act of 2007 (the 9/11 Act) to provide that if the Department of Homeland Security (DHS) does not by April 1, 2008, issue an interim final rule for establishing minimum standards and procedures for securing containers in transit to the U.S., all containers in transit to the U.S. shall effective no later than October 15, 2008, be required to be sealed with a seal meeting the ISO/PAS 17712 requirements. As DHS did not issue the interim final rule by April 1, 2008, the requirement that containers in transit to the U.S. be sealed with an ISO/PAS 17712 will now take effect on October 15, 2008, as a so-called"self-executing legal requirement", i.e. without first requiring DHS to promulgate a rulemaking implementing the sealing requirement. In the attached General Notice, U.S. Customs and Border Protection (CBP) has advised the industry of the existing statutory sealing requirement. In its General Notice, CBP clarifies that the sealing requirementapplies to all loaded containers, including foreign cargo remaining on board (FROB), arriving by vessel at a port of entry in the U.S. on or after October 15, 2008. In other words - the sealing requirement does not apply to empty containers or export containers. Further, CBP recognizes that certain types of containers cannot readily be sealed with an ISO/PAS 17712 compliant seal, including tank containers, non-standard containers (e.g. open top containers), or containers "that simply cannot accommodate a seal meeting the ISO/PAS 17712 standard (such as customs built containers)". CBP's General Notices makes clear that these types of containers are not subject to the sealing requirement. Of note is that CBP's General Notice does not specify the type of seal that must be affixed to U.S. inbound loaded containers. It repeats the statutory language that simply calls for ISO/PAS 17712 compliant seals. That includes indicative, security, and high security seals. It does not require high security seals. However, Members will recall that ocean carriers in the C-TPAT program have agreed that: "A high security seal must be affixed to all loaded containers bound for the U.S." Members are also reminded that they must include the seal number when transmitting 24 Hour Rule information to CBP via the Automated Manifest System (AMS). There is no seal number verification requirement contained in the CBP notice. Neither the statute nor CBP's General Notice state which party is responsible for the sealing requirement, although it is obviously logical that the party stuffing the container is responsible for proper seal application. The CBP General Notice simply observes that CBP may assess a civil penalty against "the party responsible" for a violation of the sealing requirement. It does not specify who that responsible party may be. CBP will use a phase-in approach in assessing any civil penalties. Accordingly, Members may wish to consider what their policies and the policies of their marine terminal operators are with respect to the issue of seals for U.S.-bound containers in light of the above referenced October 1 statutory requirement and CBP's General Notice. In addition, ocean carriers may wish to consider the merits of including a requirement in their tariffs and service contracts requiring their customers to use ISO/PAS 17712 compliant high security seals.