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CBP to Examine Use of Blockchain in Trade Environment

U.S. Customs and Border Protection is moving ahead with an evaluation of the implications and potential application of blockchain technology to trade processing. As part of that effort, CBP’s Commercial Customs Operations Advisory Committee has established a working group to examine this issue.

A blockchain essentially functions as a distributed ledger that records transactions in a verifiable and permanent way. Blockchain records are transparent to all who have access to the network but are decentralised across that network, making them virtually incorruptible. This security has made blockchain a promising technology for recording a wide range of activities, including customs and trade-related transactions.
 
Earlier this autumn the U.S. Department of Homeland Security conducted a two-day workshop on blockchain for COAC’s new emerging technologies working group. On the first day DHS provided an overview of blockchain and how it is currently being used, while on the second day participants discussed various cases where the use of this technology might be feasible. More than a dozen proposed uses were identified, including capturing and keeping track of partner government agency licences and permits, certificate of origin reporting, free trade agreement product qualification, carnets and bonded movement tracking. CBP now plans to work with the COAC working group to further evaluate the workflow processes of some of these cases and how blockchain technology could be used, although no specific timeframe has yet been established.

According to press reports, companies and organisations in other parts of the world are also testing how blockchain may aid international trade flows, including tracking cargo containers, transferring shipping documents and confirming cross-border payments.

Content provided by Picture: HKTDC Research
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