The U.S Customs and Border Control (CBP) plans to soon start using blockchain technology to verify certificates from the North American Free Trade Agreement (NAFTA) and the Central American Free Trade Agreement (CAFTA).
The first step of this integration, which will begin next month, involves “live fire testing” a blockchain platform designed to validate that imported goods come from the country of export. It will also help to verify that suppliers in other countries are in compliance with their US importers.
Although the system will not be launching until September, it will help the agency to gather more accurate information regarding the products accepted into the country as well as how suppliers log information about trademarks and other physical properties of every single item. The move is to facilitate a smooth market adoption process of blockchain technology and to prepare for exponential growth of the technology, reported American Shipper.
CBP Business and Innovation Head Vincent Annunziato said the new system will be available via a mobile app, which would replace a manual paper-based process for verifying trademarks and physical properties of all imported goods, thereby saving the agency time and money. He also added that if blockchain gets the buy-in from all players, which include CBP’s 47 partner government agencies, it could lead to paperless borders. The agency’s ultimate goal is to eliminate paper-based processes for U.S customs operations.
Annunziato confirmed that CBP has combined efforts with the Commercial Customs Operations Advisory Committee (COAC) to develop a proof of concept that leverage distributed ledgers to verify intellectual property (IP) between IP licensees and licensors. The agency is also planning to build a blockchain-based app for examining and verifying trademarks and IP.
“So if you have a rights holder that is granting licenses to Company A, and then did they also grant the right for Company A to license out? You can now follow generationally what’s going on. So in a way, the government’s got a view of that interaction with the company, and we see it as a worthwhile venture for the rights holders,” Annunziato commented.
Applying immutable distributed ledgers to prove the authenticity of documents at the border is a sensible move and could help streamline the agency’s operations. The technology is not only effective and efficient at verifying physical documents, it could also improve the security of CBP’s data and networks, ensuring a highly transparent and secure business environment. Additionally, integrating blockchain within the shipping industry will enable the agency to identify trademark violations and other intellectual property abuses.