Federal Transportation Officer Training

1. Federal Transportation Officer Training Session 4 - International Shipments

2. International Shipping • Presented by: • Angela Lauvray • Office of Logistics Operations (A/LM/OPS) • 1701 N. Ft. Myer Dr. • Arlington, VA 22209 • 703-875-6088

3. What You Will Learn • Introduction to some of the regulations and requirements involved with international shipment of Government cargo • Basics of shipping Internationally • Basics of US Flag requirements • Information sources and an introduction to international transportation vocabulary

4. International Shipping • This lesson assumes the user has an understanding of commercial shipping and needs to know how that fits into the business processes used by civilian government agencies for making international shipments. • For the purposes of this Shipping presentation, it is recommended that users read through the definitions (slide 26 through 47) to get a general sense of their meaning and use this as a general reference for other material and aspects of shipping presented herein.

5. International Shipping Definition: Cargo movement of U.S. government goods to foreign destinations. • Civilian government agencies have a different set of rules and business processes than goods moved by Department of Defense (military) methods. • Most Civilian government freight must be cleared by the U.S. Embassy upon entry into foreign countries • The State Department has a robust transportation capability for civilian agencies to accomplish their shipping requirements.

6. International Shipping Civilian - Military • Generally, civilian government entities use the existing commercial infrastructure of vendors, forwarders, and their resources. • Military transportation offices may use these same commercial resources or may use their own organic resources (i.e., military planes or ships).

7. International Shipping Phases of International Shipping : • EXPORT: Requirements to move it out of the origin country • INTRANSIT: International laws regulating the commercial air or surface transportation service provider (TSP) while in transit, and • DESTINATION CLEARANCE: Requirements and Customs regulations to bring goods into the host country (import). NOTE: The U.S. Government also handles import shipments into the U.S. which are regulated by U.S. Customs, the Department of Agriculture, etc., and are unique to each import circumstance and commodity.

8. International Shipping U.S. State Department Shipment Management • Government agencies may use their own resources to execute international shipments, or use the services of an established government freight forwarder, like the Department of • The State Department transportation offices manage personal effects and general cargo shipping to support U.S. Government abroad. • The State Department has long established procedures for managing international logistics, to include: • A network of field offices (Despatch Agencies) and consolidated receiving point (CRPs) warehouses to receive, stage, and export USG cargo to global embassy destinations • A robust transportation management software system that provides world-wide intransit visibility • The services of the State Department transportation network are available to support any U.S. Government funded transportation requirements

9. Regulations Hierarchy

10. Code of Federal Regulations (CFR) • The U.S. Code is a codification of legislation, while the CFR serves as administrative law. • The United States Code (U.S. Code) precedes the CFR and contains statutes enacted by Congress. The CFR contains regulations, which spell out in further detail how the executive branch will interpret the law. The two documents represent different stages in the legislative process. • Every regulation in the CFR must have an "enabling statute," or statutory authority. • Administrative law exists because the Congress often grants broad authority to executive branch agencies to interpret the statutes in the U.S. Code (and in un-codified statutes) which the agencies are entrusted with enforcing.

11. Shipping Regulations • The Code of Federal Regulations (CFR) and the Foreign Affairs Manual (FAM) are the primary regulatory guides used for government shipping. • In some instances government shipments are exempt from certain regulations that apply to commercial shipments • Export declarations • In other cases, government shipments must follow regulations that do not apply to commercial shipments • American Flag carrier

12. U.S. Government International Shipping Regulations • Transportation Management: 41 CFR 102-117 • Transportation Payment & Audit: 41 CFR 102-118 • Acquisition of Transportation: 48 CFR  47 • Cargo Preference is regulated by: 46 CFR 381 • Fly America is implemented in: 48 CFR 47.4 • Foreign Affairs Manual: FAM (applies only to Foreign Affairs Agencies)

13. Governing Regulations: U.S. Export

14. Governing Regulations: Transportation Service Provider

15. American Flag Requirements Cargo Preference Act • Cargo Preference Act: 46 USC 55303 et. seq. • USG Personal Effects: 100% on US Flag carriers • USG Supplies & Equipment: 50% on US Flag carriers • Military Cargo Preference Act: 10 USC 2631 • 100 % on US Flag Vessels • In accordance with Section 901 of the Merchant Marine Act of 1936, travel and transportation of effects shall be on ships registered under the laws of the U.S. where such ships are available, unless the “necessity of the mission” requires the use of a ship under a foreign flag. • The Maritime Administration (DOT/MARAD) requires the USG to report US flag usage.

16. American Flag RequirementsCargo Preference Act • The Cargo Preference Act of 1954 applies to the following types of cargoes: • Supplies owned by the U.S. Government and in the possession of: • The US Government • A contractor of the U.S. Government • subcontractor at any tier • Supplies for the use of the U.S. Government that are contracted for, and require subsequent delivery to a U.S. Government activity but are not owned by the U.S. Government at time of shipment • Supplies not owned by the U.S. Government at the time of shipment that are to be transported for distribution to foreign assistance programs, but only if these supplies are not acquired or contracted for with local currency funds.

17. American Flag Requirements Fly America Act • Fly America (International Air Transportation Fair Competitive Practices Act of 1974), 49 USC 40118, applies to both government passengers and cargo to and from the US and between foreign points. • Open skies agreements (i.e., exceptions) with EU, Australia, Japan, and Switzerland allow these nations’ carriers to carry USG passengers and freight. • Exceptions: • no US flag carrier can provide needed transportation • Cannot accomplish mission using USG carrier

18. International Standard for Phytosanitary Measures No. 15 • ISPM-15 is the global program requiring all wood packing products used in international shipping to be heat treated or fumigated with methyl bromide and marked accordingly, or face penalties for non-compliance. • Penalties can include seizure of cargo or return to origin at the shipper’s expense. NOTE: manufactured wood like plywood or OSB is exempt from ISPM-15.

19. The Shipping Process Cargo handled by the U.S. Government falls into two main categories: Personal Effects and General Cargo. • Personal Effects: Household goods and private vehicles owned by U.S. government personnel • General Cargo: Supplies and equipment shipped on behalf of the United States Note: Applicability of regulations can be commodity driven.

20. The Shipping Process Acquiring Shipping: • Direct Procurement Method (DPM): • The Government arranges for the export packing, local transportation, ocean shipment, and other services involved in the shipment to destination port or post. Each of these individual segments, or services, are typically ordered and paid for separately. • International Through Government Bill of Lading (ITGBL): • A complete origin to destination package of services for a door-to-door shipment wherein all services (e.g., pack-out, pick-up, transport, delivery out, unpacking, etc.) are bundled together, using one forwarder to perform all services and generally paid on one billing document.

21. Best Places to Find Country Specific Information 1. Contact the local Embassy www.state.gov 2. Contact your preferred freight forwarder and ask for assistance

22. If you need Help… US Department of State Transportation Resources: http://www.state.gov/m/a/c8018.htm or Email:  TransportationQuery@state.gov Please put in the subject line: International Shipping Assistance

23. Transportation Terminology Transportation terminology is often confusing to those outside the industry. Following are some of the commonly used logistics terms used by the Department of State (DoS) in shipment management. Some terms are universal to the transportation industry and some are specific to DoS and other foreign affairs agencies. Additionally, the Department of Defense has terms specific to their logistics requirements.

44. INTERNATIONAL SHIPPING LESSON REVIEW • All USG cargo for DoS, DOD, and other civil/foreign affairs agencies is handled identically, using the same rules and regulations? True or False • What percentage of USG supplies must move on US flag carriers? • 100 • 37.2 • 50 • 75

45. INTERNATIONAL SHIPPING LESSON REVIEW • What statistics do agencies have to report to MARAD? • What is the hierarchical order for the following laws or regulations? • Code of Federal Regulations: Transportation Management 41 CFR • Public Law 88-205 • Agency Specific Regulations • United States Code • Are there any USG established freight forwarders? If so, who?