The House Ways and Means Trade Subcommittee today held a hearing to discuss the status of security and trade operations at U.S. Customs and Border Protection, and heard how CBP Commissioner Alan Bersin plans to revamp CBP.  Bersin told the subcommittee that he wants to help legitimate trade by focusing enforcement efforts more on high-risk trade rather than low-risk trade.

According to Bersin, while this will help facilitate trade, it also means tougher efforts to combat illegitimate trade, and to that end he said he wants to stop the illegal transshipment of goods by working with U.S. trading partners, screening for high-risk shipments, and running post-release verification audits of goods. Bersin also said he supports exploring the possibility of making it easier for CBP to share information with U.S. right holders about imported goods that are suspected of violating U.S. IPR laws in an effort to boost enforcement efforts, and recommended a change the U.S. Trade Secrets Law to that end.  He also suggested that he would like to see changes in the system for collecting antidumping and countervailing duties.  A Treasury official testifying with Bersin, Deputy Assistant Secretary for Tax, Trade and Tariff Tim Skud, noted that the Departments of Commerce and Treasury will soon send a report to Congress on the pros and cons of a retrospective versus prospective collection system.

Cass Johnson of the National Council of Textile Organizations testified that there is “no more important” issue facing the U.S. industry than illegal transshipment.  Attacking both the importing community and foreign producers, he asserted that the textile industry sees evidence that companies producing yarns and fabrics overseas are illegally advertising themselves as U.S. companies in order to win NAFTA and CAFTA orders.  He called for disclosure to mills of information about the importer of record of garments made in preference and FTA countries, ostensibly to determine whether claims of U.S. inputs are supported.  He also pushed for an electronic verification system.

Rep. Bob Etheridge (D-NC) asked Johnson to explain “Operation Mirage,” which Johnson alleged uncovered that many new importers of goods from China are drastically undervaluing these imports.  Earlier, Etheridge asked Bersin how much specialized textile and apparel training CBP conducts for its staff; Bersin assured him there is such training.  Etheridge asked Bersin to provide that information in writing.

As expected, Johnson used his testimony to announce that tomorrow NCTO and several members of Congress from U.S. textile states will introduce the Textile Enforcement and Security Act of 2010, which he described as requiring the U.S. government to undertake more than a dozen new efforts aimed at stopping transshipment.

Today’s hearing was ostensibly aimed at informing subcommittee members as they try to put together a customs reauthorization bill. Subcommittee Chairman John Tanner (D-TN) said he was interested in testimony from all of the witnesses and that he wants their help as they consider a bill.