When Is C-TPAT Right For You?

The Customs-Trade Partnership Against Terrorism (C-TPAT) was established to ensure the safety and security of cargo arriving in the United States. Although being C-TPAT certified is not required by any governmental agency, many private companies only partner with C-TPAT compliant businesses. Thus, Third Party Logistics Providers (3PLs) are strongly motivated to obtain certification.

However, in order for a 3PL to be eligible for C-TPAT certification it must meet some minimum requirements. For example, it MUST do all of the following:

1. Be directly involved in the handling and management of the cargo from point of stuffing overseas up to the first U.S. port of arrival. (Entities which only provide domestic services and are not engaged in cross border activities are not eligible.)

2. Manage and execute these particular logistics functions using its own transportation, consolidation and/or warehousing assets and resources.

3. Be licensed and/or bonded by one of the following: the Federal Maritime Commission, the Transportation Security Administration, U.S. Customs and Border Protection, or the Department of Transportation, and

4. Maintain a staffed office within the United States.

And in order to participate in the C-TPAT program a 3PL may NOT:

1. Subcontract any service beyond a second party other than to other CTPAT members (This means that CBP does not allow the practice of “double brokering”, the 3PL may contract with a service provider, but it may not allow that contractor to further subcontract the actual provision of this service to an unknown third party).

2. Be a non asset-based 3PL which only performs duties such as quoting, booking, routing, and auditing (these type of 3PL may possess only desks, computers, and freight industry expertise) without its own warehousing facilities, vehicles, aircraft, or any other transportation assets. These non-asset based entities are excluded from C-TPAT as they are unable to enhance supply chain security throughout the international supply chain.

If your business is not otherwise eligible for C-TPAT certification but desires to obtain it, it might consider obtaining one of the necessary agency licenses. If you have questions on doing so, we are able to help.

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One response to “When Is C-TPAT Right For You?

  1. Pingback: Third Party Logistics (3PL) Implementation Methodology | The Good Word

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